Buyer protection credit terms were recently adjusted by the Credit Card Act of 2009. This act affords consumers additional protection from credit card companies. Specifically these changes pertain to credit card interest rate and fee limitations, disclosure requirements, and age restrictions on credit marketing among other terms. This article will serve as a guide to buyer protection credit terms in regard to legal premises, buyer protection terms, and consumer advocacy.
The legal foundation of buyer protection terms
Buyer protection credit terms are legal agreements offered by creditors before and during the providing of credit to consumers. By agreeing to the terms of credit and credit protection, both the buyer and the creditor are acknowledging rules are in place regarding the handling of credit and circumstances surrounding that credit. There are many types of credit terms as credit varies. For example, there are credit cards, mortgages, car loans, leases, lines of credit, home equity loans etc. Since each of these loan products are different, credit terms must be tailored to comply with the nature of each specific loan.
Ultimately buyer protection credit terms are determined by Federal and State regulation and not exclusively by the terms of agreement that come with the credit application. In some cases, terms of agreement may be invalid due to non-compliance with statutory law. Title 15, Chapter 14 of the U.S code outline the Federal requirements regarding credit protection. This covers issues such as 1) disputing debt, 2) debt collection practices, 3) liability of creditors and debtors and more.
The U.S. code is occasionally updated to incorporate Federal laws such as the Fair Credit Billing Act, Consumer Credit Protection Act, Fair Debt Collections Practices Act, Credit Repair Organizations Act and more. According to Title 15 of the U.S. Code, U.S. States must have consumer protections in place that are not inconsistent with Federal regulations, or go above and beyond them in regard to protecting the consumer.
Buyer protection: The credit agreement and rights
Before accepting credit consider consulting The Federal Reserve Board's 'Consumer Handbook to Credit Protection Laws.' This handbook outlines some of the key aspects of credit that should be disclosed by the creditor to the buyer such as how and what interest rates and fees are charged, conditions of the leases, manner of credit terms disclosure, obligations of both debtor and creditor etc. The providing of specific information to consumers from creditors is required to help protect the consumer from misunderstandings that can lead to financial damage. For example a credit card agreement may have the following aspects as required by law.
• Liability protection for unauthorized use of credit
• Payment of credit
• Interest and fees
• Identity theft procedures
• Limitations on credit use
• Enforcement of financial penalty
• Disclosure of creditor lending terms
Larger credit loans such as mortgages may be far more complex as the number of laws governing the credit increases due to the nature of the loan. For example, a mortgage involves multiple parties such as Title company, Realtor(s), Bank, municipal record keepers, insurers, inspectors etc. all of whom have their own terms of lending, contracting, charging and rules they must follow to be legally compliant.
Mortgage agreements can be multiple pages long, written in legalese and difficult to read during a home closing meeting. Due to this, the assistance of an attorney may be helpful when reviewing or contesting the credit terms. Additional credit regulations pertain to credit records for which further protections are afforded to the consumer.
• Credit repair organization requirements
• Consumer credit information provisions
• Dispute procedures and rights
• Credit reporting regulations
Buyer credit terms protection advocacy
Government and private organizations exist to assist consumers in having their buyer protection credit terms properly honored. Additionally, changes to credit laws take place to modernize credit protection. For example, annual free credit reports were not always a consumer privilege.
Buyers may now report and dispute errors found on credit reports and take steps to have errors removed. Consumer advocacy organizations can be contacted in cases where credit fraud, credit repair fraud, credit identity theft, unresolved dispute claims and other credit problems occur. Three of these organizations are listed below.
• State Departments of Consumer Affairs
• Federal Trade Commission: Bureau of Consumer Protection
• The Identity Theft Assistance Center
• American Alliance on Consumer Interests
• Consumer Federation of America
Buyer protection credit terms are often small print agreements written in financial or legal language and at times may be difficult to comprehend. These terms often include information on the cost of lending, liability protections, buyer and lender rights, use of credit, billing procedure etc.
Legislative regulation exists to protect the consumer from credit fraud, abuse, impropriety and other aspects of borrowing and lending. These protections are consist of a number of Federal and State Acts which credit lenders such as banks are required to follow if applicable. Violations of these terms may occur at times, in which case consumer awareness and enforcement of protection laws may be necessary.
Image source: Petr Kratochvil
The legal foundation of buyer protection terms
Buyer protection credit terms are legal agreements offered by creditors before and during the providing of credit to consumers. By agreeing to the terms of credit and credit protection, both the buyer and the creditor are acknowledging rules are in place regarding the handling of credit and circumstances surrounding that credit. There are many types of credit terms as credit varies. For example, there are credit cards, mortgages, car loans, leases, lines of credit, home equity loans etc. Since each of these loan products are different, credit terms must be tailored to comply with the nature of each specific loan.
Ultimately buyer protection credit terms are determined by Federal and State regulation and not exclusively by the terms of agreement that come with the credit application. In some cases, terms of agreement may be invalid due to non-compliance with statutory law. Title 15, Chapter 14 of the U.S code outline the Federal requirements regarding credit protection. This covers issues such as 1) disputing debt, 2) debt collection practices, 3) liability of creditors and debtors and more.
The U.S. code is occasionally updated to incorporate Federal laws such as the Fair Credit Billing Act, Consumer Credit Protection Act, Fair Debt Collections Practices Act, Credit Repair Organizations Act and more. According to Title 15 of the U.S. Code, U.S. States must have consumer protections in place that are not inconsistent with Federal regulations, or go above and beyond them in regard to protecting the consumer.
Buyer protection: The credit agreement and rights
Before accepting credit consider consulting The Federal Reserve Board's 'Consumer Handbook to Credit Protection Laws.' This handbook outlines some of the key aspects of credit that should be disclosed by the creditor to the buyer such as how and what interest rates and fees are charged, conditions of the leases, manner of credit terms disclosure, obligations of both debtor and creditor etc. The providing of specific information to consumers from creditors is required to help protect the consumer from misunderstandings that can lead to financial damage. For example a credit card agreement may have the following aspects as required by law.
• Liability protection for unauthorized use of credit
• Payment of credit
• Interest and fees
• Identity theft procedures
• Limitations on credit use
• Enforcement of financial penalty
• Disclosure of creditor lending terms
Larger credit loans such as mortgages may be far more complex as the number of laws governing the credit increases due to the nature of the loan. For example, a mortgage involves multiple parties such as Title company, Realtor(s), Bank, municipal record keepers, insurers, inspectors etc. all of whom have their own terms of lending, contracting, charging and rules they must follow to be legally compliant.
Mortgage agreements can be multiple pages long, written in legalese and difficult to read during a home closing meeting. Due to this, the assistance of an attorney may be helpful when reviewing or contesting the credit terms. Additional credit regulations pertain to credit records for which further protections are afforded to the consumer.
• Credit repair organization requirements
• Consumer credit information provisions
• Dispute procedures and rights
• Credit reporting regulations
Buyer credit terms protection advocacy
Government and private organizations exist to assist consumers in having their buyer protection credit terms properly honored. Additionally, changes to credit laws take place to modernize credit protection. For example, annual free credit reports were not always a consumer privilege.
Buyers may now report and dispute errors found on credit reports and take steps to have errors removed. Consumer advocacy organizations can be contacted in cases where credit fraud, credit repair fraud, credit identity theft, unresolved dispute claims and other credit problems occur. Three of these organizations are listed below.
• State Departments of Consumer Affairs
• Federal Trade Commission: Bureau of Consumer Protection
• The Identity Theft Assistance Center
• American Alliance on Consumer Interests
• Consumer Federation of America
Buyer protection credit terms are often small print agreements written in financial or legal language and at times may be difficult to comprehend. These terms often include information on the cost of lending, liability protections, buyer and lender rights, use of credit, billing procedure etc.
Legislative regulation exists to protect the consumer from credit fraud, abuse, impropriety and other aspects of borrowing and lending. These protections are consist of a number of Federal and State Acts which credit lenders such as banks are required to follow if applicable. Violations of these terms may occur at times, in which case consumer awareness and enforcement of protection laws may be necessary.
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