Consumer Debt Protection Laws

Excessive credit card debt can mean a lot of unpleasant things, but laws exist that were meant to protect people from the unscrupulous practices that some companies may engage in. People in credit card debt may be in the process of seeking a way to encourage a credit card debt reduction, but while they do this, it would be a good idea for them to know the laws pertaining to this area before they begin debt settlement procedures.

The Consumer Credit Protection Act & Truth in Lending

Under this law, credit card companies are required to inform their clients of all important information such as the fees that will be charged for using the card. The annual percentage rate (APR) is another highly important fact that people need to be informed of before a credit card company ever offers the card to new clients.

The Fair Debt Collection Practices Act (FDCPA)

After people have found themselves in credit card debt, they will need to obtain debt management services. During this process they may be receiving several calls from collections agencies. The FDCPA gives these agencies guidelines as to what they can and cannot do. One such guideline states that people from these companies must not lie to the person who owes money.

The Fair Credit Reporting Act (FCRA)

The laws under the FCRA pertain to how the three credit bureaus and the smaller credit bureaus report people’s credit information. It was written to ensure that these credit bureaus are reporting everybody’s credit information accurately. If there are any inaccuracies on their credit reports, these people are entitled to have those inaccuracies corrected in the event that they can demonstrate negative entries are in error.

The Credit Repair Organizations Act

The Credit Repair Organizations Act is aimed specifically at debt management companies that seek to obtain credit card debt reduction for their clients. Under this law, these types of companies must not charge their clients any money before they have begun to work on their cases. As far as their credit reports are concerned, these debt management companies must make sure their clients understand that they can’t remove accurate negative entries from their credit reports.

As people look for someone to help them with credit card debt reduction, they need to be aware of the laws that were written in their favor. Knowing something about these laws will make it less likely that they will be taken advantage of by companies that only want to relieve them of their money.