Consumer Credit Laws

Consumer laws are a group of laws that were created to protect the rights of consumers, ensure fair trade, and accurate information in the marketplace. Below is a list of the most common laws that I use:

Credit CARD Act (2009), designed to limit how credit card companies can charge you. Such as giving you enough time to pay your bills (21 days from time bill is mailed); no retroactive rate increases (you must have at least 45 days’ notice); can’t change any terms of the contract within a year; low introductory rates must last at least 6 months; statements must show how long it will take you to pay off your balance if you continue to pay the minimum amount, the total interest cost to pay off the entire balance in 3 years; The Act also places new limits on fees and rate increases, and requires consistency in payment dates and times; and more!

Credit Repair Organizations Act (CROA-1996) prohibits a variety of false and misleading statements, as well as fraud by credit repair organizations. Prior to hiring a repair company, be sure to review what they can and cannot do to protect yourself. Be mindful that certain professionals are exempt from some provisions of the CROA.

Consumer Credit Protection Act (CCPA-1969) a consumer protection law that includes the Equal Credit Opportunity Act, the Fair Credit Billing Act, the Fair Credit Reporting Act, Credit Repair Organizations Act, and the Truth in Lending Act.

Equal Credit Opportunity Act (ECOA-1974) prohibits discrimination in credit transactions on the basis of certain personal characteristics including race, color, religion, national origin, sex, marital status, age, being a recipient of public assistance or exercising your rights under the Consumer Credit Protection Act.

Fair and Accurate Credit Transactions Act (FACTA-2003), an amendment to the Fair Credit Reporting Act, allows consumers to request and obtain a free credit report once every twelve months from each of the three nationwide consumer credit reporting companies. These free credit reports may be accessed at annualcreditreport.com. It also helps in preventing identity theft by preventing any entity from listing your entire ssn or account number on their statements, reports, and forms.

Fair Credit Billing Act (FCBA-1974) requires that a credit card company credits your payments and corrects errors right away on your bill without damage to your credit score. It also lets you dispute credit card billing errors and withhold payment for damaged goods.

Fair Credit Reporting Act (FCRA-1970) what the entire credit repair process is based on; protects you against inaccurate or misleading information contained in your credit files maintained by credit reporting agencies. It requires that you must be told what’s in your credit file and have the ability to correct any errors that may exist. Credit bureaus and the companies that furnish information to the bureaus must comply with the FCRA.

Fair Credit and Charge Card Disclosure Act (FCCCDA-1988) requires a lender offering you a credit card to tell you about certain terms and fees associated with the card, including the annual percentage rate (APR), annual fees, and any interest-free periods you may have to pay your bill prior to being charged any interest.

Fair Debt Collection Practices Act (FDCPA-1977) protects you against harmful, deceptive practices used by some debt collectors. Lists the rules a debt collector must follow when trying to collect a debt from you. The most easy to understand consumer law, I strongly advise reading it.

Real Estate Settlement Procedures Act (RESPA-1974) designed to protect prospective homeowners by requiring disclosure by lenders of settlement fees and costs during the lending process.  It also prohibits kickback and referral fees from occurring that could inflate these settlement costs in any way.  If you are facing foreclosure and the lender is not providing you with proper documentation; under RESPA you can make a Qualified Written Request to obtain that additional information and to resolve any billing errors.

Telephone Consumer Protection Act (1991) regulates telemarketing calls, auto-dialed calls, prerecorded calls, text messages, and unsolicited faxes. It also is the authority to create the National Do-Not-Call List.  (This Act gets updated a lot; the most recent updated occurred July 2015; Experian has a really good summary of this law as well).

Truth in Lending Act (1968) requires that lenders use uniform methods for calculating the cost of credit and for disclosing credit terms so that you can tell how much it will cost to borrow money. It also limits your liability to $50 if your credit card is lost, stolen, or used without your authorization, and it prohibits the unsolicited issuance of credit cards. The Fair Credit Billing Act and the Fair Credit and Charge Card Disclosures Act are additions to the Truth in Lending Act, as are many provisions of the Credit CARD Act.

For a comprehensive list of your consumer rights visit the Federal Reserve System’s website.

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