CREDIT LAW

TRUTH IN LENDING ACT Enacted in 1968 Protects consumers in their dealings with lenders and creditors mandates disclosure of specific pieces of information before extending credit annual percentage rate (APR) term of the loan total costs to the borrower

TRUTH IN LENDING ACT (continued) Requires that lenders use uniform methods for computing the cost of credit and for disclosing credit terms so that the consumer can tell how much it will cost to borrow money. Limits your liability to $50 if your credit card is lost, stolen, or used without your authorization. Prohibits the unsolicited issuance of credit cards.

FAIR CREDIT REPORTING ACT Enacted in 1970 Regulates the accuracy, fairness, and privacy of consumer credit information.

FAIR CREDIT REPORTING ACT (continued) Under this act, you have the right to : Free file disclosure once per year from each of the major credit bureaus. Requires credit bureaus to investigate a consumer dispute within 30 days. Requires a lender who denies you credit because of negative information in your credit report to provide the name, address, phone #, etc. of the credit bureau that issued the report. You then have 60 days to request a free copy of the report. Requires credit bureaus to reissue corrected reports to lenders who received an erroneous report. score/

EQUAL CREDIT OPPORTUNITY ACT Enacted in 1974 and expanded in 1977 Prohibits lenders from discriminating against consumers in all aspects of credit on the basis of sex, marital status, color, race, religion, national origin, age, reliance on income from a public assistance program, or exercise of rights under the Consumer Credit Protection Act. Your ability and intent to repay borrowed funds are the only acceptable criteria.

FAIR CREDIT BILLING ACT Enacted in Protects consumers against unfair billing practices.

FAIR CREDIT BILLING ACT (continued) Creditors must send customers a written explanation of the steps to take when a billing error or question occurs. The borrower must notify the lender in writing about an incorrect billing with in 60 days of receiving the bill. The lender must answer the borrower within 30 days. Within 90 days, the lender must either correct the billing or show that it is correct. Until the dispute is settled, the lender cannot close or collect on the account.

ELECTRONIC FUNDS TRANSFER ACT Enacted in Similar to the Fair Credit Billing Act, however, this law applies to the use of computers, automatic teller machines, debit cards, and other electronic banking transactions. Liability is limited to $50 if you notify the issuing institution within 2 business days. Liability expands to $500 if notification is after 2 days. Potential loss is unlimited if notification occurs after 60 days.

FAIR DEBT COLLECTION PRACTICES ACT Enacted in Protects consumers from abusive, unfair, or deceptive conduct by collection agencies. Permitted to contact persons other than the debtor only to locate the debtor. Cannot reveal or publicize a debtors debt to other people. Required to send written notice after making contact with the debtor, informing the debtor of the amount of the debt, the name of the creditor, and the fact that the debt will be considered valid unless disputed within 30 days. Prohibited from harassing, oppressing, or being abusive when collecting a debt. Collectors cannot misrepresent the consequences of nonpayment. Must stop contacting you if you ask them to in writing.

Credit CARD Act (Credit Card Accountability Responsibility and Disclosure Act) Passed in 2009 and enacted in February and August of Provides additional protection to consumers. To receive a credit card, consumers must be 21 years old unless they have a co-signer or show proof of sufficient income to make payments. Interest rates on existing balances can not be raised unless the cardholder is 60 days or more past due. Cardholder must be notified of any significant changes in rates and fees at least 45 days before the changes take effect. Cardholders now have to opt-in to allowing transactions that take them over their credit limit.

Credit CARD Act (Credit Card Accountability Responsibility and Disclosure Act)--continued Issuers are required to send a monthly statement at least 21 days before a payment is due. Payment due dates must be consistent month to month. No inactivity fees. Cannot charge a fee of more than $25 unless one of your last 6 payments was late. Cannot charge more than one fee for a single event. Increased APR must be re-evaluated every 6 months. Credit card bill must include information about how long it will take to pay off the balance if only minimum payments are made. soon/

DODD-FRANK WALLSTREET REFORM AND CONSUMER PROTECTION ACT Passed in Comprehensive reform act designed to strengthen our countrys financial system. Provided for the creation of the Consumer Protection Bureau. Enforces federal consumer financial laws.

BANKRUPTCY ABUSE PREVENTION AND CONSUMER PROTECTION ACT Enacted in Makes it more difficult to file for Chapter 7 bankruptcy. Chapter 7 bankruptcy = debtors are legally declared unable to pay debts. Assets (property and possessions) are sold by the court and money collected from the sale is divided among the creditors. Chapter 13 bankruptcy = debtors with regular incomes pay back some or most of their debts over a 3 to 5 year period. While doing so they are under the supervision and protection of the court. They are protected from legal action by creditors. A court appointed trustee distributes payments to creditors in accordance with the plan.