Nevada Revised Statutes 97A.200 – Prohibited acts by issuer: Increase of interest rate based upon late payment to another creditor; universal default clauses; exception
1. An issuer shall not:
Terms Used In Nevada Revised Statutes 97A.200
- Contract: A legal written agreement that becomes binding when signed.
- Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. Source: OCC
(a) Increase the interest rate it charges a cardholder for the use of the card based upon the late payment by the cardholder to another issuer or a creditor of the cardholder that is not an affiliate or subsidiary of the issuer; or
(b) Include a universal default clause in a contract or other agreement relating to a credit card account.
2. Notwithstanding the provisions of subsection 1, an issuer may increase the interest rate it charges a cardholder for the use of the card based on a change in the credit rating of the cardholder.
3. As used in this section:
(a) ’Affiliate or subsidiary of the issuer’ means an affiliate or subsidiary that conducts business under a name that is:
(1) The same as the name of the issuer; or
(2) Sufficiently similar to the name of the issuer that a cardholder could reasonably believe that the cardholder is conducting business with the issuer.
(b) ’Universal default clause’ means a clause or provision that allows an issuer to increase the interest rate it charges a cardholder for the use of the card based upon the late payment by the cardholder to another issuer or a creditor of the cardholder that is not an affiliate or subsidiary of the issuer.