Most people will apply for credit at some point in their life. In fact, credit cards, auto loans and mortgage loans are common accounts that many people depend on. However, those who apply for or obtain these loans often do not fully understand their rights regarding these transactions. To help protect yourself, familiarize yourself with the following laws that were enacted with consumer rights in mind.
The Equal Credit Opportunity Act
Consumers have rights when it comes to applying for credit. The Equal Credit Opportunity Act (ECOA) states that a creditor may not discriminate against an applicant based on sex, race, marital status, religion, national origin, age or receipt of public assistance. With the exception of religion, creditors may ask about these things in certain situations. However, they cannot discriminate based on the answers given. For instance, they cannot deny a loan or offer less favorable terms based on these factors. Additionally, under the ECOA, if you are denied credit you are legally entitled to know the specific reason.
The Fair Credit Reporting Act
Your credit report is an essential tool when it comes to applying for credit. After all, it provides potential creditors with a detailed account of your current and previous loans, mortgages and credit cards, your payment history, paid or unpaid collection accounts, bankruptcy status and more. Because of the impact these reports can have, the Fair Credit Reporting Act (FCRA) promotes the accuracy, fairness and privacy of consumer information contained within them.
According to the FCRA, you have the right to receive a copy of your credit report. Further, each of the three major credit reporting agencies must provide you with a free copy once every 12 months, at your request. Additionally, you are also entitled to request a free report if you are denied credit, if you are unemployed and looking for a job, if you are on welfare or if your report is inaccurate because of identity theft or fraud.
The Truth In Lending Act
Consumers have the right to fully understand the financing terms being offered when applying for credit or a loan. The Truth In Lending Act (TILA) sets requirements for lenders in terms of mandatory disclosures. Under this act, lenders must disclose the annual percentage rate, finance charges including any application fees, late fees or penalties, the amount financed, the payment schedule, and the total amount that will be repaid over the life of the loan. These disclosures must occur before a consumer signs. Additionally, these terms must appear on billing statements. Disclosing these details allows the consumer to make an informed decision regarding obtaining credit.
The Fair Debt Collection Practices Act
When taking on new credit, you are responsible for keeping up with the payments. However, if you fall behind, you still have rights when it comes to the attempted collections of past due payments. The Fair Debt Collection Practices Act (FDCPA) prohibits debt collectors from being unfair, deceptive or abusive during their collection attempts. For example, a debt collector may not harass you on the phone, call you at work if your company does not allow it, or falsely imply that you have committed a crime. Additionally, they must identify themselves when calling, they may only contact you between 8am and 9pm, and they must stop contacting you if you submit that order in writing.
Contact Us For Help With Consumer Credit Laws
The attorneys at Churchill, Quinn, Hamilton & Van Donselaar, Ltd. are experienced in defending consumers against unfair practices by lenders or creditors. If you feel that your rights have been violated, schedule a consultation with us. We will advise if you were treated unfairly according to the law and will represent you in obtaining a resolution. Contact us at 847-223-1500 to learn more.