Consumer Credit Protection

Consumer credit protection

Consumer credit protection

Your rights as a credit card holder and credit applicant are protected through a number of important legislative acts. Private insurance coverage is also available to you as a credit card holder.

Legal protection: Federal legislation was enacted to address a number of important concerns relating to credit. Some of the major issues addressed by these laws include discrimination in the awarding of credit, incomplete or unclear disclosure of credit terms, unfair billing and collection practices, correction of credit report errors, and credit card fraud.

Discrimination: As a credit card applicant, you are protected against discrimination in the awarding of credit by the Equal Credit Opportunity Act. This act prohibits discrimination on a number of grounds and requires that credit applicants be informed of the credit issuer’s decision within 30 days of receiving the credit application. The original act prohibited discrimination based on gender and marital status. It was amended to also prohibit discrimination based on age, race, national origin, religion, and whether the applicant receives public assistance (welfare) benefits.

The act also addresses special credit problems that some women face. It requires creditors to report information on joint accounts to credit bureaus in both a husband’s and a wife’s name if both spouses use the account and are liable for account obligations. Prior to this change, creditors could report information in one name, usually the husband’s. This practice created problems for a woman wanted to obtain credit after divorce or the death of her husband because the credit history was only in the former husband’s name.

Charge Card Disclosure Act:This act also requires credit card issuers to notify you before your account is renewed.

Billing and collection practices: What do you do if you find an error in your credit card statement? You are protected against unfair billing practices by the Fair Credit Billing Act. This act regulates billing practices and sets forth procedures for correcting errors in your credit card statement. If there is a billing error, you are required to notify the credit issuer within 60 days of receiving the statement.