Using credit cards is great, but it’s also essential to stay protected. Thanks to the credit card legal rights, you can always find a way out of credit card issues. If you don’t know about the rights you get with credit cards, you might be cheated.
So, if you are planning to get a travel credit card or business credit card soon or you already have one, you should know your rights.
This article covers seven important legal rights that you must know
1. Right to No-Discrimination Policy
When you apply for a credit card, the issuer can’t discriminate against people or companies based on some non-financial factors.
According to the Equal Credit Opportunity Act (ECOA), it is illegal for lenders to discriminate against someone applying for a credit card loan based on age (unless you are below the legal age), race, religion, marital status, color, or if you receive public assistance.
Credit card issuers must inform you about the result of the credit card application within 30 days. If they reject the request without any reason, you can ask them for an explanation in 60 days.
2. Right to Full Information
Credit card companies are entitled to follow the Truth in Lending Act and disclose all information about credit card offers with the customer.
The information includes the interest rate, annual percentage rate, yearly charges, and late fees. This law protects you from unfair billing and saves you from unwanted surprises.
The issuing personnel must share complete information about the time required to pay off the credit loan if you pay a minimum amount every month.
Moreover, the credit card legal rights allow you to ask as many questions regarding your credit card terms and conditions.
3. Right to Report Billing Statements Errors
Credit card companies should mail you the billing statement at least 21 days prior to the payment due date. The billing statement includes credits from your account, minimum payment, due date, and late payment charges.
If you find any error in the billing statement, you have the right to dispute the errors under the Fair Credit Billing Act.
This act involves the steps to raise your concern and handle billing disputes. You can issue the complaint in 60 days after receiving the statement, and you don’t have to pay the disputed charge while the dispute is unresolved.
Most companies handle disputes on call and mail. However, you must send a complaint in writing as well.
4. Right to Financial Privacy
Once you get the card, there may be security concerns that keep bothering your peace of mind. You might be thinking about who can view the financial status of your credit card. Well, there’s nothing to worry about.
Your information is completely safe, and no one can view it without your permission. Mostly landlords, employers, utility companies, and credit card issuers require your credit card information as it’s a part of application processing. However, they need your permission first.
5. Protection from Unfair Fees
You should always read the terms and conditions for your credit card. Still, you could face issues like hidden charges.
Unfair charges on credit cards are a headache as nobody likes to pay extra fees and hidden charges. So, the credit card legal rights under the Credit CARD Act offer the right to customers to charge penalties against issuers who break fair credit laws.
6. Protection from Credit Errors
Credit reports aren’t always spotless and accurate; that’s why you should always check them. According to the Fair Credit Reporting Act, you have the right to get accurate credit reports. Also, if you spot some mistake, you can ask for an amendment.
An FTC study showed that about 25% of consumers found an error in their credit report, while 5% were paying extra interest fees due to those errors.
It was also concluded that 10% of the customers who disputed the inaccuracies, ended up with better credit scores, and got better loan terms.
7. Right to Freeze the Credit
You have the right to freeze the credit to protect it from theft or misuse. A credit freeze is also known as a security freeze, and by doing so, no one can access your credit details or open an account with your name.
Moreover, you lift the security freeze without paying any charges. Just remember the PIN, contact the credit bureau and follow the steps they recommend.
Now that you know credit card legal rights, we hope you can protect yourself from any fraud or issue. Keep these in mind so you can always remind the credit card company when there is a need.
We suggest you always take a stand whenever you find something odd while dealing with credit cards.