Lenders and creditors must adhere to a variety of laws designed to protect consumers' rights, ensure fair practices, and maintain transparency in financial transactions. Here’s a complete list of key laws:
1. Fair Credit Reporting Act (FCRA)
Purpose: To ensure the accuracy, fairness, and privacy of consumer information contained in the files of credit reporting agencies.
Key Provisions: Consumers have the right to access their credit reports, dispute inaccurate information, and have erroneous data corrected.
2. Truth in Lending Act (TILA)
Purpose: To promote the informed use of consumer credit by requiring disclosures about its terms and cost.
Key Provisions: Lenders must provide clear and conspicuous disclosure of key terms of the credit arrangement and all costs.
3. Fair Debt Collection Practices Act (FDCPA)
Purpose: To eliminate abusive practices in the collection of consumer debts.
Key Provisions: Debt collectors must not use deceptive, unfair, or abusive practices and must provide validation of the debt upon request.
4. Equal Credit Opportunity Act (ECOA)
Purpose: To prevent discrimination in credit transactions.
Key Provisions: Creditors cannot discriminate against applicants based on race, color, religion, national origin, sex, marital status, age, or because they receive public assistance.
5. Fair Credit Billing Act (FCBA)
Purpose: To protect consumers from unfair billing practices and to provide a mechanism for addressing billing errors.
Key Provisions: Consumers can dispute billing errors on their credit card accounts and withhold payment on damaged goods or services purchased with a credit card.
6. Electronic Fund Transfer Act (EFTA)
Purpose: To protect consumers in electronic fund transfers.
Key Provisions: Establishes the rights, liabilities, and responsibilities of parties in electronic fund transfers and protects consumers when they use such systems.
7. Gramm-Leach-Bliley Act (GLBA)
Purpose: To protect consumers' personal financial information held by financial institutions.
Key Provisions: Financial institutions must explain their information-sharing practices to their customers and safeguard sensitive data.
8. Servicemembers Civil Relief Act (SCRA)
Purpose: To provide protections for military members as they enter active duty.
Key Provisions: Limits the interest rate on pre-service debts and protects servicemembers from certain legal actions during active duty.
9. Dodd-Frank Wall Street Reform and Consumer Protection Act
Purpose: To promote financial stability and protect consumers from abusive financial services practices.
Key Provisions: Created the Consumer Financial Protection Bureau (CFPB), which enforces consumer protection laws.
10. Credit Repair Organizations Act (CROA)
Purpose: To ensure that credit repair organizations provide accurate information about their services and avoid deceptive practices.
Key Provisions: Prohibits misleading and deceptive practices by credit repair organizations.
11. Real Estate Settlement Procedures Act (RESPA)
Purpose: To protect consumers during the home buying process.
Key Provisions: Requires disclosures about the real estate settlement process and prohibits kickbacks and referral fees that unnecessarily increase the cost of certain settlement services.
12. Home Mortgage Disclosure Act (HMDA)
Purpose: To provide the public with information that will help show whether financial institutions are serving the housing needs of their communities.
Key Provisions: Requires financial institutions to maintain and annually disclose data about home purchases, home purchase pre-approvals, home improvement, and refinance applications.
13. Home Ownership and Equity Protection Act (HOEPA)
Purpose: To address abusive practices in refinances and closed-end home equity loans with high interest rates or high fees.
Key Provisions: Provides additional protections for high-cost mortgages, including restrictions on loan terms and additional disclosure requirements.
14. Community Reinvestment Act (CRA)
Purpose: To encourage depository institutions to help meet the credit needs of the communities in which they operate, including low- and moderate-income neighborhoods.
Key Provisions: Financial institutions are periodically evaluated on their performance in meeting the credit needs of their entire community.
15. Military Lending Act (MLA)
Purpose: To protect active-duty military members and their families from predatory lending practices.
Key Provisions: Caps the interest rates on loans to military members and provides other financial protections.
These laws collectively ensure that lenders and creditors conduct business in a fair, transparent, and non-discriminatory manner, while providing various rights and protections to consumers.
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