Section 22.2

1. Section 22.2

2. What You’ll Learn • How to identify and describe credit protection laws (p. 493) • How to explain your rights and duties under credit protection laws (p. 493)

3. Why It’s Important Knowing about credit protection laws will help you be a smarter consumer.

4. Legal Terms • Equal Credit Opportunity Act (p. 493) • Fair Credit Reporting Act (p. 493) • Fair Credit Billing Act (p.493) • Fair Debt Collection Practices Act (p. 494)

5. Section Outline Credit Protection Laws Equal Credit Opportunity Act Fair Credit Reporting Act Fair Credit Billing Act Fair Debt Collection Practices Act

6. Pre-Learning Question How does the government help protect your rights as a user of credit?

7. Credit Protection Laws The government has established laws to protect your rights as a consumer as well as your credit.

8. Equal Credit Opportunity Act The Equal Credit Opportunity Act ensures that both businesses and consumers are given an equal chance to obtain credit.

9. Equal Credit Opportunity Act The law makes it illegal for banks and businesses to discriminate against credit applicants because of their • sex • race • marital status • national origin

10. Equal Credit Opportunity Act • religion • age • public assistance income

11. Fair Credit Reporting Act The Fair Credit Reporting Act prohibits the abuse of a valuable consumer asset-—credit. The act deals with unfavorable reports issued by credit bureaus.

12. Fair Credit Reporting Act Credit reports, which contain much personal data, are frequently issued to • banks • insurance companies • businesses • prospective employers

13. Fair Credit Reporting Act You have the right to know all personal information that is in a consumer reporting agency’s files and the sources of the information.

14. Fair Credit Reporting Act You also have the right to be told the name of anyone who received a copy of your credit report in the past year (two years, if the credit report relates to a job application).

15. Fair Credit Billing Act When errors are made in bills sent by credit card companies and businesses that give credit, the Fair Credit Billing Act can help you.

16. Fair Credit Billing Act If you believe an error has been made on a bill, notify the creditor in writing within 60 days of the date of the statement and follow the format of the sample letter given.

17. 22.2 Sample Dispute Letter Date Your Name Your Address Your City, State, Zip Code Your Account Number Name of Creditor Billing Inquiries Address City, State, Zip Code

18. 22.2 Sample Dispute Letter Dear Sir or Madam: I am writing to dispute a billing error in the amount of $_____ on my account. The amount is inaccurate because (describe the problem). I am requesting that the error be corrected, that any finance and other charges related to the disputed amount be credited as well, and that I receive an accurate statement.

19. 22.2 Sample Dispute Letter Enclosed are copies of (use this sentence to describe any enclosed information, such as sales slips, payment records) supporting my position. Please investigate this matter and correct the billing error as soon as possible. Sincerely, Your name Enclosures: (List what you are enclosing.)

20. Fair Debt Collection Practices Act Under the Fair Debt Collection Practices Act, it is illegal for debt collectors to threaten consumers with violence, use obscene language, or contact consumers by telephone at inconvenient times or places.

21. Fair Debt Collection Practices Act Debt collectors are not allowed to impersonate government officials or attorneys, obtain information under false pretenses, or collect more than is legally owed.

22. Match the law with its description. • This act gives you 60 days to notify a creditor in writing that you believe an error has been made on a bill.

23. ANSWER Fair Credit Billing Act

24. This act makes it illegal for debt collectors to threaten consumers with violence or use obscene language.

25. ANSWER Fair Debt Collection Practices Act

26. This act gives you the right to know all personal information about you that is in a consumer reporting agency’s files and the sources of the information.

27. ANSWER Fair Credit Reporting Act

28. Section 22.2Assessment Reviewing What You Learned • What is the purpose of the Equal Credit Opportunity Act?

29. Section 22.2Assessment Reviewing What You Learned Answer Ensures that businesses and consumers are given equal chance to obtain credit.

30. Section 22.2Assessment Reviewing What You Learned • What does the Fair Debt Collection Practices Act make it illegal for debt collectors to do?

31. Section 22.2Assessment Reviewing What You Learned Answer To threaten consumers with violence, use obscene language, or contract consumers by telephone at inconvenient times or places.

32. Section 22.2Assessment Reviewing What You Learned Answer Debt collectors are not allowed to impersonate government officials or attorneys, obtain information under false pretenses, or collect more than is legally owed.

33. Section 22.2Assessment Critical Thinking Activity Credit Protection Laws Do you think credit protection laws are necessary? Why or why not?

34. Section 22.2Assessment Critical Thinking Activity Answer Credit Protection Laws Answers will vary but will probably recognize that consumers are entitled to some protection.

35. Section 22.2Assessment Legal Skills in Action Credit Protection Choose one of the credit protection laws discussed in this section and research when and why it was made into a law. Write a one-page report about your findings.

36. Section 22.2Assessment Legal Skills in Action Answer Credit Protection Reports will vary but should document their sources of information.

37. End of Section 22.2