44.3: Credit Protection

$1000

A credit-reporting agency that fails to comply with the Fair Credit Reporting Act is liable for actual damages, plus additional damages not to exceed___ and attorney's fees. $500, $700, $1000, $2000

b

The Fair Debt Collection Practices Act requires a collection agency to include a(n) ____________ whenever it initially contacts a debtor for payment of a debt or within five days of that initial contact. a. invalidation notice b. validation notice c. cease-and-desist notice d. adjudication notice

unsolicited, cannot

If a consumer receives an_________credit card in the mail that is later stolen, the company that issued the card ____________charge the consumer for any unauthorized charges.

a rescission of the credit contract

If a creditor does not exactly follow the provisions of the Truth-in-Lending Act (TILA), the debtor may receive ________________ .

4

Regulation Z applies to any transaction involving an installment sales contract that calls for payment to be made in more than __________installments.

b

Regulation Z is issued by the Federal Reserve Board of Governors and governs: a. pyramid schemes and sales. b. credit provisions associated with installment sales contracts. c. complaints brought under the Federal Food, Drug, and Cosmetic Act. d. deceptive advertising.

in the ordinary course of business, natural persons

TILA applies to those who lend funds, sell on credit, or arrange extensions of credit _________and protects debtors who are___________ .

disability

The Equal Credit Opportunity Act (ECOA) prohibits lenders from denying credit solely on the basis of all of the following EXCEPT: age, race, disability, marital status

a

The Truth-in-Lending Act (TILA) requires sellers and lenders to disclose credit terms or loan terms so that individuals can shop around for the best financing arrangements. a. True b. False

Consumer Financial Protection Bureau

The___________is dedicated to overseeing the practices of banks, mortgage lenders, and credit-card companies.

place, inconvenient, payment, intimidate, refusing

Under the Fair Debt Collection Practices Act, a collection agency may not contact the debtor at the debtor"s_____ of employment if the debtor"s employer objects, contact the debtor at _______ or unusual times or at any time, if the debtor is being represented by an attorney, contact third parties other than the debtor"s parents, spouse, or financial adviser about ___________ of a debt unless a court authorizes such action, harass or ________the debtor or make false or misleading statements, or communicate with the debtor at any time after receiving notice that the debtor is to pay the debt, except to advise the debtor of further action to be taken by the collection agency.

increase, advance, due, specific, charge, excess, highest, compute

Amendments to the Truth-in-Lending Act"s credit card rules state that a company may not retroactively________the interest rates on existing card balances unless the account is sixty days delinquent; must provide forty-five days"____________ notice to consumers before changing its credit-card terms; must send monthly bills to cardholders twenty-one days before the ____________date; may not increase the interest rate charged on a customer"s credit-card balance except in situations, such as when a promotional rate ends; may not___________ over-limit fees except in specified situations; must apply payments in_________of any minimum amount due to the ___________ rate when the consumer has balances at different interest rates; and must not ________ finance charges based on the previous billing cycle.

b

When a consumer is denied credit or insurance on the basis of his or her credit report, the consumer does not have to be notified of that fact. a. True b. False

a

Which act was passed in an effort to combat identity theft? a. The Fair and Accurate Credit Transactions Act b. The Fair Credit Reporting Act c. The Federal Trade Commission Act