Trump's Proposed 10% Credit Card Interest Rate Cap: How It Could Impact Bankruptcy Filings and Provide Relief for Americans struggling with high-interest debt.
- McMann, P.A.
- Feb 3
- 2 min read
Updated: Apr 6
Understanding Trump’s 10% Credit Card Interest Rate Cap Proposal
Former President Donald Trump has proposed a 10% cap on credit card interest rates, a significant shift from the current average rates, which often exceed 20-25%. While details on the implementation timeline and scope of this cap remain uncertain, the policy aims to provide relief for Americans struggling with high-interest debt.
When Did Trump Announce This Policy?
Trump first introduced the idea of a 10% cap on credit card interest rates during his 2024 campaign, emphasizing the need for consumer financial relief. He has since reiterated his commitment to this policy, potentially expanding it to other forms of consumer debt such as personal loans. However, as of early 2025, the exact legislative path for this policy remains unclear, pending congressional approval and banking industry responses.
For individuals considering Chapter 7 bankruptcy, Trump's proposed credit card interest cap raises several important factors:
Reduced Financial Pressure on Debtors
If implemented, the 10% cap could significantly lower monthly credit card payments, making it easier for consumers to manage debt without resorting to bankruptcy.
Individuals who were previously overwhelmed by high-interest rates may find relief through lower minimum payments, reducing the urgency to file for bankruptcy.
Delayed Bankruptcy Filings
Many individuals contemplating Chapter 7 bankruptcy may choose to wait and see how the interest rate cap affects their financial situation.
A lower credit card interest rate could allow some debtors to gradually pay down their balances, avoiding the need for bankruptcy altogether.
Potential Restrictions on New Credit
If the cap becomes law, credit card companies may tighten lending standards, making it more difficult for individuals with lower credit scores to obtain new credit.
Consumers who rely on credit cards to cover emergency expenses may need to explore alternative financial planning strategies.
Impact on Debt Discharge Decisions
Chapter 7 bankruptcy allows individuals to eliminate unsecured debt, including credit card balances.
However, if interest rates are capped, some filers may decide to negotiate repayment plans instead of filing for bankruptcy, especially if monthly payments become more manageable.
Should You Hold Off on Filing for Bankruptcy?
If you are considering Chapter 7 bankruptcy, here are some key takeaways:
If Trump's policy is implemented, lower interest rates could make it easier to manage existing debt, potentially reducing the need to file for bankruptcy.
However, if you are already facing overwhelming debt, lawsuits, or wage garnishments, waiting for legislative changes may not be a viable option.
Consulting with an experienced bankruptcy attorney can help determine whether waiting or filing now is the best strategy for your financial situation.
Get Legal Guidance on Bankruptcy and Debt Relief
At McMann, P.A., we help individuals navigate Chapter 7 and Chapter 13 bankruptcy and explore debt relief solutions based on their financial needs. If you’re struggling with credit card debt and wondering how Trump’s proposed policy could impact your options, our legal team is here to help.
Mark D. McMann
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