Post about "Credit Collections"

Debt and Credit Laws for Your Protection

A good credit history is essential for each individual who has a potential need to take out a loan. The credit worthiness of an individual reflects on all his financial dealings and, in reality, impacts a person’s entire life. If your credit score isn’t especially admirable, then you may be denied loans or advances when you have a need. Alternatively, you might be able to secure a loan with a low credit score, but it will be at a higher rate of interest than those prevalent in the market. Your credit score is taken quite seriously by lenders, debtors, various financial institutions, and even employers.In the United States, there are two particular laws of note related to credit governance. With these laws, citizens can be more informed about the reasons behind their approval or rejection of claims and loans. They are summarized below.Fair Debt Collection Practices ActThis act forms a portion of the “Consumer Credit Protection Act.” In essence the law emphasizes the need for a just and rational ethical approach in protecting the rights of the consumer. It forbids debt collectors from using pressure tactics, misleading actions, and discriminatory powers to harass consumers for the rounding up of their debts.Debt collectors cannot contact a borrower, for example, simply to determine their whereabouts. Neither are they permitted to contact debtors before 8:00 a.m. or after 9:00 p.m. local time. They cannot coerce, use pressure tactics, or intimidate with legal action. In practice, though, the Act excludes banks, department stores, and grocery stores that have their own debt collection services.Fair Credit Reporting ActThis Act provides for confidentiality, discretion, and validation of facts in creating an individual’s credit reports. It seeks to control the distribution, collection, and utilization of “consumer credit information.”Once customers receive their credit reports, they can also validate them and pursue modifications as needed to the report since the credit bureaus are required to maintain up-to-date information about them. Some organizations, such as government agencies, insurance companies, and banks may also receive these confidential reports about you.Additionally, consumers have the right to receive information about any denied credit. This way, an individual can verify whether there are inconsistencies of any sort in the reports.These are just some of the rights customers are able to derive from the Fair Credit Reporting Act and the Fair Debt Collection Practices Act. These laws are used to uphold the rights of the consumers and provide them with fair, unbiased treatment.