Credit Law

Credit Laws arise under both state and federal regulations governing interest, finance charges, cash advances, charges for extensions of credit in excess of pre-established limits, late fees or delinquency charges, premiums on credit life and credit accident and health insurance, annual fees and other charges and fees, and many others. If a business grants credit to customers, it must comply with federal laws affecting credit sales to consumers, as well as state laws in whichever jurisdiction it is operating. Federal credit laws include the Truth in Lending Act (TILA), the Fair Credit Billing Act (FCBA), the Equal Credit Opportunity Act, the Fair Credit Reporting Act (FCRA), and the Fair Debt Collection Practices Act (FDCPA).

The Truth in Lending Act

This Act helps customers know what they are agreeing to in a credit transaction. It requires businesses to disclose their exact credit terms and regulates how credit providers can advertise. Required disclosures include monthly finance charges, annual interest rates, payment due dates, total sale prices, and how late charges are assessed and how much they are.

The Fair Credit Billing Act

This federal law governs billing errors on credit accounts. The customer must notify the credit provider within 60 days of an incorrect charge, and the credit company must respond within 30 days. The creditor must conduct a reasonable investigation and, within 90 days of getting the customer's letter, explain why the bill is accurate or correct the error. Failure of a creditor to comply will result in a $50 credit toward the disputed amount, even if the bill was correct, and the creditor cannot report the disputed amount to credit agencies until the disagreement is resolved.

The Equal Credit Opportunity Act

Credit companies may not discriminate against an applicant on the basis of race, color, religion, national origin, age, sex, or marital status. The only justifiable bases for declining to extend credit are things like the applicant's financial status (earnings and savings) and credit record. Although there is a prohibition against age discrimination, a credit company can reject a consumer who is underage.

The Fair Credit Reporting Act

This is the federal law primarily related to credit reporting agencies. It protects consumers from haiving their eligibility for credit disrupted as a result of incomplete or misleading information contained in one's credit report. The law gives consumers the right to receive a copy of their credit reports and challenge inaccurate information contained in it. If the business reporting inaccurate information does not change or delete the inaccurate information after being alerted to the inaccuracy, the consumer can add a 100-word statement to the file explaining his or her side of the story.

The Fair Debt Collection Practices Act

This federal law addresses abusive methods used by third-party debt collectors. This act can create liability for harassing or abusive practices, like speaking to people other than the debtor about the obligation, repeatedly calling, trying to collect amounts not due, intentionally reporting inaccurate amounts to credit reporting agencies, and so forth.


Know Your Rights!

Articles About Credit Law

  • Bankruptcy Isn't the End, It's the Beginning
    Bankruptcy isn’t the end, it’s the beginning. Bankruptcy immediately stops annoying and harassing collection calls, foreclosure, repossession, wage garnishment, and eviction. In addition, the bankruptcy process tries to teach new credit and money management skills as you must complete two courses: pre-filing bankruptcy counseling and post filing debtor education course.
  • Millennial Money: Mistakes and Lessons Learned in My 20s
    20s is the ideal time to fund your footings. This article elaborates on some ways you make millennial money without repeating the same mistakes that most people make.
  • Updated and Clarified - New York’s Commercial Financing Disclosure Law SB 5740
    SB 5740 is New York State’s new law (commencing January 1st, 2022), requiring non-conventional lenders, including funders of Merchant Cash Advance, to make certain disclosures in the contract paperwork available for a small business borrower to make informed borrowing decisions. Examples of required disclosures include revealing the total cost of financing as well as presenting the small business borrower with a defined APR (Annual Percentage Rate). SB 5740 applies to Merchant Cash Advances. In fact, New York law makers took the time to list a Merchant Cash Advance as one kind of unconventional non-bank lending, the Statute is designed to govern. SB 898 has been passed and it provides us with more clarity and defines the scope of SB 5740 and its reach.
  • New York Passes Merchant Cash Advance Regulation Requiring Transparency & Disclosures
    Commencing January 1, 2022: “New York State Adopts Truth In Lending (TILA) – Like Disclosure Law for Business Loans, including Merchant Cash Advance and Purchase of Future Receivables.” This article will endeavor to explain the new law and all it entails, while simultaneously providing macro context to why the law has been enacted.
  • How do you enforce a final judgment in Florida
    A judgment does not always come from a trial, but it often does signal the end of the litigation. A final judgment issued by a court establishes that the court has determined one party to be the winner and usually entitled to some amount of money. While the judgment itself does not require payment of money it allows the holder of the judgment to use the court's power to get money or property. That power is the topic of this article.
  • Coronavirus and Debt Relief
    The coronavirus pandemic has not been easy for anyone. Whether you started 2020 with accumulated debt or fell into serious debt (like millions of others) because of job or business loss, wage cuts, illness, or the death of a wage earner in your family, you may now need urgent assistance. If you are barely making ends meet, suffering the angst and humiliation of receiving debt collection calls daily, worried that you will never be financially stable again, you are not only not alone; you have legal remedies available.
  • How a Chapter 13 Bankruptcy Can Lower Your Car Loan
    For many of our clients, their motor vehicle is their most valuable asset. If they own a home, then their car or light truck is typically their second-most important asset. Unfortunately, motor vehicles lose value rapidly. It isn’t unusual to owe far more on a car loan than your vehicle is even worth.
  • Should You Seek Dismissal of Your Chapter 13 Bankruptcy?
    A Chapter 13 bankruptcy provides debtors the option of paying off debts for 3-5 years without needing to give up any property in return. At the end of the payment plan, certain unpaid debts will finally be discharged, i.e., wiped out and no longer a nuisance.
  • Has Identity Theft Ruined Your Credit?
    According to Consumer Affairs, about 10% of Americans are victims of identity theft each year. Thieves often steal personal information (such as Social security numbers) to commit fraud. Many of them will open credit cards or other lines of credit in your name and then abscond with the gains, leaving you with the debt and shredded credit.
  • Will the Covid Vaccine Rescue Small Businesses? Or Is Chapter 11 Bankruptcy an Option?
    The federal government has recently approved several vaccines for the novel coronavirus, and truckloads of shipments have been arriving in Florida. But will the vaccine be a game-changer that rescues our slumping economy?
  • All Debtor and Creditor Law Articles

    Articles written by attorneys and experts worldwide discussing legal aspects related to Debtor and Creditor including: bankruptcy, collections, credit and mortgage, debt recovery and insolvency.

Find a Lawyer