Protect Your Rights When You Seek to Obtain Consumer Credit
The law of consumer credit is primarily embodied in federal and state statutory laws. These laws protect consumers and provide guidelines for the credit industry:
- Versions of the Uniform Consumer Credit Code—States have passed various statutes regulating consumer credit. The UCCC (Uniform Consumer Credit Code), a law designed to protect consumers obtaining credit to finance their transactions, ensure that adequate credit is provided and govern the credit industry in general, has been adopted in 11 states.
- The Consumer Credit Protection Act—Congress enacted the CCPA in part to regulate the consumer-credit industry, including credit card companies and credit-reporting agencies. The act requires creditors to disclose credit terms to consumers. It also protects consumers from loan sharks, restricts the garnishing of wages and established the National Commission on Consumer Finance to investigate the consumer finance industry. The act prohibits discrimination based on sex or marital status in the extending of credit and also regulates certain debt collectors.
- The Fair Credit Reporting Act (FCRA)—This law offers protection to consumers regarding credit reports. Among its provisions, it grants consumers the right to ask for credit score, to know when credit reports will be used against them, to know what is in a credit report, and the right to dispute inaccurate information or have out-of-date information removed from their record.
- The Equal Credit Opportunity Act—The ECOA prohibits certain types of discrimination in lending, banning credit decisions based on race, color, religion, national origin, gender, marital status, age or receipt of public assistance.
- The Truth in Lending Act—Under the Truth in Lending Act, lenders covered by its provisions must disclose annual percentage rates, finance charges, amount financed, and total number of payments to be made. The law only applies to lenders who offer or extend credit on a regular basis.