Five Laws Every Consumer Should

Know

By Jenkins & Clayman

5 LAWS EVERY CONSUMER SHOULD KNOW

1. Fair Debt Collection Practices Act

2. Cooling-Off Rule

3. Fair Credit Reporting Act

4. Electronic Funds Transfer Act

5. Magnuson-Moss Warranty Act

Fair Debt Collection Practices Act

This law aimed at preventing such abusive collection practices of personal debts, such as mortgages, credit cards, car loans, etc.)

Business-related debts do not fall under the FDCPA. FDCPA limits when and how collectors may contact

you, defines what they have to tell you about your debt, and prevents them from engaging in certain collection tactics at all.

Always keep records of all contact with debt collectors: send written communication such as faxes and letters and keep copies of everything you send; record your phone conversations with collectors whenever possible.

If debt collectors violate the FDCPA, you have the right to sue for damages and attorney’s fees.

Fair Debt Collection Practices Act (cont.)

Debt collectors may not call you at an inconvenient time (i.e. early in the morning or late at night)

If you ask collectors, either orally or in writing, not to contact you at work, they must respect your request. 

Debt collectors can’t discuss your debt with nobody but you, your spouse, and your attorney.

Debt collectors must send you a written notice of how much you owe and to whom to contact and how to proceed.

Debt collectors may not threaten violence, use obscene language, or call you repeatedly.

They may not falsely claim to be attorneys or that you will be arrested, or try to collect any interest or fees beyond what you actually owe.

If you want the debt collectors to stop contacting you altogether, you can tell them in writing and they are required by law to stop. They still have the right to sue you for collection.

Cooling-Off Rule

If you’ve purchased something that cost more than $25 in your home and you want to return it, you have the right to do so within 3 days under the Cooling-Off Rule.

The Cooling-Off Rule applies to sellers who come to your home or sellers in a temporary place of business, such as a convention center or fairground.

The rule does not apply to the sale of arts and crafts sold at fairs, shopping malls, or civic centers. It also doesn’t apply to the purchase of cars or real estate.

Sales conducted entirely through the mail or by telephone are not covered, nor are products you purchased for emergency use. It does, however, cover sales even if you invited the salesperson into your home, whether spontaneously or for an event.

Cooling-Off Rule (cont.)

You have to notify the seller in writing postmarked before midnight on the third business day after you made the purchase. You may deliver it by hand or request a return receipt.

At the time of the sale, the seller should provide you with two copies of a cancellation form. You should keep one form for your records and send the other to the seller. If you don’t get cancellation forms, you can write your own cancellation letter.

After receiving your cancellation request, the seller has 10 days to refund your money. Within 20 days, the seller must pick up the product or reimburse the mailing costs for the return.

You do have to return what you bought in good condition – if you’ve damaged it then you’re bound by the sale.

Fair Credit Reporting Act

Under the FCRA, you’re entitled to one free copy of your credit report every year from each of the three national credit reporting companies: Equifax, Experian, and TransUnion.

You should check your credit report regularly to make sure that all the information is correct. If you find an error, report it to the credit reporting company in writing.

If you see things on your credit report as credit card opened in your name and left unpaid, you may have been a victim of an identity theft. That report affects your ability to get loans, purchase cars, and find employment.

They have to investigate the error within 30 days and provide you a copy of your updated credit report.

Electronic Funds Transfer Act

If you pay your bills online, your paychecks are directly deposited into your account, or have a debit or ATM card, than you should know about the EFT Act.

If you find an error on your bank statement, you have 60 days from the time the statement was sent to notify your financial institution in writing of the error. If you miss the 60-day deadline, they don’t have to investigate at all and you may be entirely out of luck.

The institution must investigate the error within 10 days, share the results of its investigation within 3 days of finishing it, and correct any errors within the next business day after that.

You must report a lost or stolen debit card to your financial institution within 2 business days of realizing it’s missing. If you do, your loss will be limited to $50. If you report it after more than 2 days but less than 60, your loss will be limited to $500.

If you report it after more than 60 days, you’re liable for all charges show up.

Magnuson-Moss Warranty Act

The Magnuson-Moss Warranty Act protects your warranty from being voided by a dealership, if you get work done by outside mechanic or even yourself.

If you or the mechanic makes an error that causes damage to the car, then the dealership is not responsible for fixing that damage. However, the warranty will still be in place for the rest of the car.

The Magnuson-Moss Warranty Act also protects your warranty if you use recycled or aftermarket parts.

If the aftermarket part causes damage, the dealership may refuse to fix that damage, but the warranty still applies to the rest of the car.