House backs bill increasing credit card user protections

WASHINGTON -- The House last week passed new consumer protections for credit card users, including restrictions on how banks can charge fees and raise interest rates.

The House voted 357-70 for a bill that offers a salve to borrowers in the midst of a recession, when many people have turned to their credit cards to help meet expenses.

The bill is supported by President Barack Obama, and was made stronger through amendments suggested by the White House. Democrats have said they hope to get it to Obama's desk by Memorial Day.

Among its provisions, the bill would prevent lenders from abruptly raising interest rates on existing balances except under limited circumstances, and requires them to give 45 days notice of any rate hike. It adds restrictions on credit cards offered to college students, and forbids companies from giving cards to anyone under 18.

Most protections would not go into effect until July 2010, in tandem with regulatory changes being put in place by the Federal Reserve.

Supporters said they aimed to give consumers a fair shake against what they called predatory practices by card issuers. Others said they worried that banks might make less credit available as an unintended consequence of the new rules. It may drive smaller banks out of the credit card market, some said.

Reps. Shelley Berkley and Dina Titus, both D-Nev., voted for the bill. Rep. Dean Heller, R-Nev., voted against it.

OBAMA BUDGET PASSED

The House and Senate gave the final sign-off to a $3.56 trillion budget blueprint for fiscal 2010 that sets the stage for Congress to tackle vexing tax and spending issues and ambitious Obama initiatives on health care and climate change.

The House passed the Obama budget, 233-193. The vote in the Senate was 53-43. No Republicans voted for the budget in either body. All but 17 Democrats voted for it in the House, and four voted against it in the Senate.

Democrats said the budget makes investments in priorities such as health care, renewable energy and education, renews tax breaks for middle income families and begins the process of reducing the deficit that has skyrocketed in the past year as Congress worked to avert economic collapse.

Republicans argued the budget was too expensive, and will open the door for Democratic "big government" approaches to fix the nation's problems.

They also were steamed that Democrats placed a "reconciliation" clause in the budget that will allow health care reform to be passed with a simple majority vote in the Senate rather than 60 votes that would allow Republicans more ability to shape the bill.

Democratic leaders said they intended to work with Republicans on health care, and the reconciliation language was there only if the parties reach an impasse.

Berkley and Titus voted for the budget. Heller voted against it.

In the Senate, Sen. Harry Reid, D-Nev., voted for the budget. Sen. John Ensign, R-Nev., voted against it.

MORTGAGE AID BID BLOCKED

Legislation that would allow bankruptcy judges to change the terms of troubled mortgages was blocked in the Senate.

The vote was 45-51 against an amendment that Sen. Richard Durbin, D-Ill., tried to attach to a housing aid bill. It would have given judges the option to lower interest rates, principal amounts or payment schedules for homeowners facing foreclosure.

Durbin argued the plan would be helpful to hold down the flood of foreclosures by encouraging lenders to work out troubled mortgages for homeowners rather than risk action by a judge. Judges can alter the terms of second homes but not primary residences, he said.

Opponents argued the amendment merely would lead lenders to increase rates, leading to higher costs for mortgage holders, stalling the nation's recovery from recession. Negotiations for a deal among Durbin, consumer groups and banks broke down.

Reid voted for the amendment. Ensign voted against it.

HATE CRIME LAW EXPANDED

The House expanded the federal law on hate crimes to cover attacks against people based on their sexual orientation of if they have a disability.

The law already covers crimes based on race, religion, nationality and gender.

The bill was passed, 249-175. Critics said it singled out certain crime victims for special treatment. They also complained the bill was brought to the House floor under a fast-track procedure that prevented them from offering amendments.

Berkley and Titus voted for the bill. Heller voted against it.

Contact Stephens Washington Bureau Chief Steve Tetreault at stetreault@stephensmedia.com or 202-783-1760.