Credit can have a major impact on your life outside of its ability to enable you to make purchases. For example, some employers consider your credit report as one of the factors involved in the hiring process, so it can affect whether or not you get a particular job. That's why it's important to understand the value of credit and also to understand your credit rights if you're treated unfairly. The major laws that regulate credit are outlined below.

Fair Credit Reporting Act:

The Fair Credit Reporting Act promotes the accuracy and privacy of information in consumer credit reports. It also controls the use of credit reports and requires consumer reporting agencies to maintain correct and complete files.

In other words, you not only have the right to review your credit report, you also have the right to have any inaccuracies corrected. Highlights of the Fair Credit Reporting Act include:

• It is the Credit Bureau's responsibility to provide you access to your credit information, as well as providing you with information regarding who has inquired about your account recently. Beginning in 2005, everyone will be entitled to 1 free copy of their credit report. Otherwise, you may obtain a free copy because of the following reasons: (1) you have recently been denied credit, (2) you are unemployed and plan on seeking a job within the next 60 days, (3) you are on welfare, or (4) your report is inaccurate due to fraud.
• You may chose to Opt Out of unsolicited offers from credit issuers and insurance companies. You may either write or call Equifax, Experian, and Trans Union to be removed from these lists. Telephone requests are valid for 2 years; written requests are permanent. For telephone requests, call (888) OPT OUT.

Equal Credit Opportunity Act:

The Equal Credit Opportunity Act requires that individual creditors apply credit standards in a fair manner, so that all consumers are given an equal chance to obtain credit. It does not require all creditors to have the same standards, nor does it guarantee approval of loan applications.

In other words, creditors are required to apply the same standards for granting credit to everyone who applies. While they are not required to use the same standards, they can not refuse to grant credit based on sex, race, marital status, religion, national origin, age, income from assistance programs, or if you exercise your rights under the Consumer Protection Act. Highlights of the Equal Credit Opportunity Act include:

• Though you are not required to answer, the only time it is permissible to ask your sex, race, ethnicity, or religious affiliation is when you are applying for residential real estate. These questions are allowed to be asked solely to enforce fair housing laws. Creditors can ask about your marital status if your spouse will be involved in securing, using, or will be legally responsible for the loan. Married couples also have the right to have their credit histories listed separately.
• You may be asked about how items such as alimony or child support affect your income if you plan on using this income to repay the loan.
• Creditors are not allowed to deny credit because of age (particularly those who are 62 and over). However, they may ask your age to be sure that you are of legal age or to estimate how long you will continue to work.
• The terms of your credit arrangement cannot be changed when things in your life change, such as, marriage or retirement
• You must be notified within 30 days of submission of an application for credit. If you are denied credit, the creditor must provide in writing the action taken, the reason for denial, the right's of an applicant, and the name and address of the reporting credit agency. If you believe that you have been discriminated against, you may sue for damages up to $10,000.

Fair Credit Billing Act:

The Fair Credit Billing Act provides for the prompt correction of errors on open-end credit accounts (department store credit accounts, for example) and protects consumers' credit ratings while they are settling disputes.

This law dictates that a creditor cannot report a consumer's account as delinquent when they are disputing a charge. It is the responsibility of the consumer to report, in writing, a disputed item to the creditor within 60 days of receiving the bill. The creditor must respond within 30 days.

Fair Debt Collection Practices Act:

The Fair Debt Collection Practices Act promotes the fair treatment of consumers by prohibiting debt collectors from using unfair, deceptive, or abusive practices.

Though this act is directed toward professional debt collectors and does not specifically apply to banks, department stores, and other lenders who collect their own debts, no one is allowed to use unfair, deceptive, or abusive practices. Highlights of the Fair Debt Collection Practices Act include:

• The only reason a debt collector can contact someone other than the debtor is to make a reasonable effort to communicate with or to locate the debtor.
• The debtor, once located, must be notified in writing of the amount of the debt, the name of the creditor, and the fact that the debtor has 30 days to dispute the notice, otherwise, the debt will be considered to be valid.
• Debt collectors are prohibited from harassing, oppressing, or being abusive in their efforts to collect on a debt. Consumers can sue debt collectors who violate the Fair Debt Collection Practices Act for actual and punitive damages.

For more questions regarding credit bureaus and credit practices, please contact:

Federal Trade Commission

Consumer Response Center--FCRA

600 Pennsylvania Ave, NW

Washington, D.C. 20580

http://www.ftc.gov

(877) FTC-HELP