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Federal Consumer Protection Laws



If you are taking out personal loans, you need to understand your rights as a consumer and learn what you need to do for help with a financial institution regulator. Be sure to protect your privacy and financial identity from theft and fraud. Also make sure your deposits are insured with your bank, in case you or the bank run into financial trouble. Some of the most important rules and regulations out there are meant to protect you as a consumer. Below are some on the most important Federal Consumer Protection Laws and Regulations for your protection in financial dealings with other companies.

Truth in Lending Act (TILA) enacted in 1968 protects the consumer and requires the lender to tell the consumer how much the borrowed money will cost, with a clear disclosure of the aggreement terms and all costs. This way a consumer has a choice to shop around and compare loan interest prices.

Fair Credit and Charge Card Disclosure Act requires credit and charge card companie to give full information on their terms. Annual Percentage Rates (APRs), annual fees, and cash advances tende to vary from one company to another. Vairable APRs can change at any time on a card. This also discoses a grace period to make a payment on your monthly bill before a finance charge is added for non-payment.

Fair Credit Reporting Act (FCRA) enacted in 1970 regulates the collection, dissemination and how the consumer's personal information is used. This also includes how your credit history (how you pay your bills) is held by other credit bureaus and how it can be used by lenders.

Equal Credit Opportunity Act (ECOA) enacted in 1974 prohibits lenders from discriminating against consumers in any credit transaction. This includes personal characteristics such as race, color, sex, age, marital status, religion, national origin.

Fair Debt Collection Practices Act (FDCPA) a U.S. statute added in 1978, prevents collection abuse practices from the lender and carries rules a debt collector must follow when they are trying to collect a debt from the money borrowed by the consumer.

Home Equity Loan Consumer Protection Act requires a lender to disclose information about terms, rates, and conditions on the home equity loan plan that is offered. It is disclosed at the beginning, when you receive an application and again right before you use the line of credit for the first time.

The Home Ownership and Equity Protection Act (HOEPA) added in 1994 requires disclosures and imposes substantive limitations on mortgage transactions having rates or fees that are above a certain amount or percentage. It also requires disclosures about the potential costs for reverse mortgages. This is helpful if the consumer is refinancing their mortgage or applying for a home equity installment loan.

Fair Housing Act was adopted in 1968, and increased department enforcement roles in 1988 by prohibiting lenders from discrimination against the consumer in real estate mortgages or home improvement loans, regardless of race, color, national origin, sex, religion, familial status, or handicap.

Real Estate Settlement Procedures Act (RESPA) passed in 1974, states that lenders must inform the costs required to close a mortgage loan to the consumer / purchaser. RESPA also protects consumers from extremly high real estate settlement costs by prohibiting scrupulous business practices. RESPa is applied anytime when the purchaser refinances a loan or a new loan is done, such as a mortgage loan or a home equity loan.

Fair Credit Billing Act was enacted as an amendment to the Truth in Lending Act. The Fair Credit Billing Act's purpose is to protect consumers from unfair billing preactices and requires that lenders correct the mistake right away on your credit card bill.

Expedited Funds Availability Act (EFAA or EFA) was enacted in 1987 and limits how long banks may delay the use of the funds you deposit into an account. The main purpose is to standardize the hold periods on the deposits to commercial banks.

Truth in Savings Act (TISA) was a federal law passed in 1991 that requires lenders to disclose the terms of their deposit accounts in a uniform way. It was noted by the U.S. Congress that the TISA federal law would create a more stable economy, increase competition between depository institutions, and leave consumers to make their own decisions.

Electronic Fund Transfer Act (EFT) was added in 1978, and limits a person's liability if their ATM card is lost or stolen, calls for investigation on the charges and correction of the charge errors made to your account.