The U.S. Supreme Court recently ruled that consumers who sign credit card agreements containing an arbitration clause cannot take their lenders to court to dispute fees or charges, and must go through an arbitrator.
The decision, which went 8 to 1 in favor of lenders, is seen as a blow to borrowers who may have legitimate gripes with charges or fees that were added to their accounts mistakenly, according to a report from National Public Radio. Nearly all credit card agreements issued in the U.S. these days contain this type of arbitration clause.
Previously, a federal law passed in 1996 allowed consumers to take their disputes to court, but the new ruling supersedes that mandate, the report said. It also applies not just to credit cards, but any type of consumer loan with the exception of mortgages, for which arbitration clauses are still legally prohibited.
Consumers should always be mindful of their credit card statements, but also keep an eye on their credit reports. These documents may contain unfair, inaccurate, or unsubstantiated markings that lower their credit scores and restrict their access to the best interest rates available.