Consumer Credit Acts and Laws to Protect You

Know Your Rights: Understanding Consumer Credit Act Protections

It’s important to know what various consumer credit act provisions and laws exist to protect consumers. Too many people who don’t know their rights don’t take advantage of the laws that protect them. We routinely talk to consumers about how to ensure that they aren’t being victimized by debt collectors and other financial predators.

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Different Kinds of Consumer Credit Act Protections

There are many different kinds of consumer credit act protections that many people may not know about. Here are just a few:

• Consumer credit protection act: This protects employees from being fired by their employers because of a wage garnishment, and sets a limit on the size of garnishments that may be applied to an employee’s earnings.
• Truth in Lending Act: Requires creditors to make written disclosures to consumers about their transactions, including annual percentage rate and other credit terms.
• Fair Credit Billing Act: This consumer credit act requires investigation of billing errors by creditors and prohibits creditors from taking adverse action against consumers until investigations are completed. It also requires payments to be applied to consumer accounts promptly.
• Fair Credit Reporting Act: This protects consumer privacy with regard to credit files, and requires credit bureaus to investigate disputed credit file information. Requires lenders, insurance companies, and others to notify consumers if adverse action is taken due to credit file information. (See “Get a Free Credit Score if You Are Denied Credit")
• Equal Credit Opportunity Act: prohibits racial or ethnic discrimination when considering requests for credit. Also includes gender, age, marital status, religion, or other forms of discrimination. Requires creditors to provide applicants with reasons why they are denied credit.
• Fair Debt Collection Practices Act: Limits the activities of 3^rd-party debt collectors to protect consumers.  (See FDCPA Voicemail Rules May Change)
• Fair and Accurate Credit Transactions Act: protects and improves the accuracy of credit records, grants consumers the right to access free credit reports annually from each of the major credit bureaus, and offers protections against identity theft. (See “Where can I obtain my free credit reports?”)
• Bankruptcy Abuse Prevention and Consumer Protection Act: requires bankruptcy filers to receive pre-bankruptcy counseling and pre-discharge debtor education.
• Credit Card Accountability Responsibility and Disclosure Act of 2009 (Credit CARD Act): enhanced disclosures to consumers, limited fees and fee increases, and limited credit available to minors and students.

The Importance of Knowing Your Rights

Any given consumer credit act contains a number of clauses affecting a wide variety of lending practices. These highlights should give you a better idea of the many laws and regulations that have been put in place to protect you.

Understanding your rights under these acts can empower you to make informed financial decisions and avoid falling victim to unfair or predatory practices.

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Get Expert Help With Credit and Debt

If you have any questions about your credit or outstanding debt, our NFCC-certified counselors are standing by and ready to help. Contact us today for a free consultation