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F ed er a l r e s e r v e Ba n k o f Dallas
DALLAS. TEXAS

7S222
C irc u la r No. 79-12
Jan u ary 18, 1979

NEW CONSUMER EDUCATION PAMPHLET
"Consum er Handbook to C re d it Protection Laws"

TO ALL BANKS, CR ED ITO RS,
AND OTHERS CONCERNED IN THE
ELEVENTH FEDERAL RESERVE D IS T R IC T :
O ur latest in a series of pamphlets is now a v a ila b le for d is trib u tio n .
T h e booklet, en titled "Consum er Handbook to C re d it Protection L aw s," was p re ­
p ared by the D ivision of Consum er A ffa irs of the Board of G overnors of the Fed­
eral R eserve System and deals w ith the cost of c re d it, c re d it ap p licatio n s, c re d it
h isto ry and reco rd s , correcting c re d it m istakes, and how to file a consumer com­
p lain t about c re d it pro ced u res.
Once again we w ould encourage member banks to d is trib u te copies of
this booklet to consumers through lobby displays and other means. Copies of
the booklet may be o rd ered by b an ks, c re d ito rs , and members of the public free
of charge from the Federal R eserve Bank of D a llas. Requests should be made in
w ritin g to the S e c retary's O ffice, Federal R eserve Bank of D a llas, Station K,
D allas, Texas 75222.
A copy of this booklet is enclosed fo r your referen ce.
S in ce re ly y o u rs ,
Robert H . Boykin
F irs t V ic e P resident
Enclosure

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

CONSUMER
HANDBOOK TO
CREDIT
PROTECTION
LAWS

CONSUMER
HANDBOOK TO
CREDIT
PROTECTION
LAWS

SEtssarF*'
,d
"
1

Decemb«r 1978

CONTENTS
•

Page

INTRODUCTION...........................................

3

THE COST OF CR E D I T ......................................

5

Shopping i the F r t Step..................................
s
is
What Laws Apply?.......................................
The Finance Charge and Annual Percentage Rate (APR)...........
A Comparison..........................................
Cost of Open-end Credit ..................................
Leasing Costs and Terms..................................
Open-end Leases and Balloon Payments.......................
Advertising ............................................
Costs of Settlement on a House..............................
APPLYING FOR CREDIT ....................................
The Old Story of Discrimination..............................
What Law Applies?......................................
What Creditors Look For .................................
Information the Creditor Can’ Use............................
t
Special Rules...........................................
Discrimination Against Women ..............................
. I You’ Turned Down ...................................
f
re

5
5
6
7
8
10
11
12
12
13
13
13
14
15
16
19
23

CREDIT HISTORIES A N D R E C O R D S ............................ 24
Building Up a Good Record................................
What Laws Apply?.......................................
Credit Histories f r Women ................................
o
Keeping Up Credit Records................................

24
25
26
27

CORRECTING CREDIT MISTAKES..............................29
What Laws Apply?.......................................
B l i g Errors ...........................................
iln
Defective Goods or Services................................
Prompt Credit for Payments and Refunds f r Overpayments ........
o
Cancelling a Second Mortgage..............................
Lost or Stolen Credit Cards ................................
Unsolicited Cards........................................
Discounts f r Cash Payments...............................
o

29
29
33
33
34
35
36
36

COMPLAINING A B O U T C R E D I T ..............................

37

Complaining to Federal Enforcement Agencies ..................
Penalties Under the Laws..................................

37
38

G L O S S A R Y ...............................................

40

SUBJECT INDEX...........................................

43

The Consumer Credit Protection Act of 1968 — which launched Truth i
n
Lending — was a landmark piece of l g s a i n For the frt time, creditors were
eilto.
is
required to s a e the costs of borrowing i a common language so that you — the
tt
n
customer — could figure out exactly what charges would be, compare c s s and
ot,
shop f r c e i .
o rdt
Since 1968, credit protections have multiplied r p d y The concepts of “f i ”
ail.
ar
and “equal” credit have been written into laws that outlaw discrimination i c e i
n rdt
transactions; require that consumers be told the reason when c
redit i denied; give
s
borrowers access to t eir credit records; and se up a method to s t l b l i g
h
t
ete iln
disputes.
Each of these laws was intended to remove some of the problems and con­
fusion from consumer cr d t which, as i became more widely used i our economy,
ei
t
n
also grew more complex. Together, these laws se a standard f how individuals
t
or
are to be treated i t e r daily credit dealings.
n hi
The laws say, for instance:
— that you can no longer be refused a credit card j s because you’e a
ut
r
s ngle woman;
i
— that you can l m t your r s i a credit card i l s or s o e ;
ii
ik f
s ot
tln
. — that you can straighten out errors i your monthly bl without damage
n
il
to your credit r t n ;
aig
— and that you won’ find credit shut o f j s because you’ reached the
t
f ut
ve
.
age of 65.

INTRODUCTION

3

But, l tthe buyer b e aw are! I i important to know your r g t and how to use
e
ts
ihs
them. This handbook explains how the consumer c e i laws can help you shop for
rdt
c e i , apply fo i, keep up your c e i standing, and — i need be — complain
rdt
r t
rdt
f
about an unfair d al. I explains what you should look f r when using credit and
e
t
o
what creditors look f r before extending i. I also points out the laws’solutions to
o
t t
discriminatory practices that have made i d f i u t f women and minorities to get
t i f c l or
credit i the p s .
n
at

Board of Governors of the
Federal Reserve System
December 1978

THE COST OF
CREDIT

You get credit by promising to pay i the future for something you receive i
n
n
the present.
Credit i a convenience. I l t you charge a meal on your c
s
t es
redit card, pay f r
o
an appliance on the instalment plan, take out a loan to buy a house, or pay f
or
schooling or vacations. With c e i , you can enjoy your purchase while you’e
rdt
r
paying f i— or you can make a purchase when you’e lacking ready cash.
or t
r
But there are s r n s attached to credit too. I usually costs something. And of
tig
t
course what i borrowed must be paid back.
s
I you are thinking of borrowing or opening a credit account, your f r t step
f
is
should be to figure out how much i w l cost you and whether you can afford i.
t il
t
Then you should shop around for the best terms.
These laws can help you compare c s s
ot:
TRUTH IN LENDING requires creditors to give you certain basic infor­
mation about the cost of buying on c e i . These “disclosures” can help
rdt
you shop around for the best d al.
e

Shopping is the
First Step

W hat Laws Apply?

5

T R U T H IN LEASING disclosures can help you compare the cost and
terms of one lease with another and with the cost and terms of buying f r
o
cash or on c e i .
rdt
The Finance Charge
and Annual Percentage
Rate (A PR )

Credit costs vary. By remembering two terms, you can compare c
redit prices
from different sources. Under Truth i Lending, the creditor must tl you — i
n
el
n
writing and before you sign any agreement — the finance charge and the annual
percentage r t .
ae
The finance charge i the t t l dollar amount you pay to use c e i . I i - 1
s
oa
rdt t n
eludes inte e t c s s and sometimes other c s s such as service charges, some ,
rs ot,
ot,
credit-related insurance premiums or appraisal f e .
es
For example, borrowing $100 f a year might cost you $7 i i t r s . I
or
n neet f
there were also a service charge of $1, the finance charge would be $8.

The annual percentage rate (APR) i the percentage cost ( r r l t v c s )
s
o eaie ot
of credit on a yearly b s s This i your key to comparing c s s regardless of the I
ai.
s
ot,
amount of credit or how long you have to repay i:
t
Again, suppose you borrow $100 for one year and pay a finance charge
of $8.
I you can keep the e
f
ntire $100 for the whole year and then pay i al
tl
back a once, you are paying an APR of 8 per c n .
t
et
But, i you repay the $100 and finance charge ( t t l of $108) i twelve
f
a oa
n
equal monthly instalments of $9 each, you don’ r a l get to use $100
t ely
for the whole year. I f c , you get to use l s and l s of that $100 each
n at
es
es

.

month. I t i case the $8 charge for credit amounts to an APR of 14.5
n hs
‘ per c nt.
e
A l creditors — banks, s o e , car dealers, credit-card companies, finance
l
trs
companies — must sta e the cost of t e r credit i terms of the finance charge and
t
hi
n
the APR. The law says these two pieces of information must be shown to you be­
fore you sign a credit contract. Federal law does not s t i t r s rates or other c e i
e neet
rdt
charges. But i does require t e r disclosure so that you can compare c
t
hi
redit c s s
ot.

Even when you understand the terms a creditor i o f r n , i’ easy to under­
s f e i g ts
estimate the difference i dollars that different terms can make. Suppose you’e
n
r
buying a $5,000 c r You put $1,000 down, and need to borrow $4,000. Compare
a.
these three credit arrangements:

APR

CREDITOR A
CREDITOR B
CREDITOR C

11%
11%
12%

Length
o f Loan

Monthly
paym ent

Total Finance
C h arg e

Total
Cost

3 years
4 years
4 years

$131

$ 716
$ 962
$1,056

$4,716

$103

$105

$4,962
$5,056

How do these choices stack up? The answer depends partly on what you
need.
7

A Comparison

The low est cost loan i available from Creditor A.
s
But i you were looking for lo w e r monthly paym ents, you could get them
f
by paying the loan o f over a longer period of time. However, you would have t
f
o
pay more i t t l c s s A loan from Creditor B — also a an 11 per cent APR, but
n oa ot.
t
for four years — w l add almost $250 to your finance charge.
il
I that four-year loan were available only from Creditor C, the A P R o f 12 per
f
cent would add another $94 to your finance charges as compared with Creditor B.
Other terms — such as the s z of the down payment — w l also make a d f
ie
il
i­
ference. Be sure to look a althe terms before you make your choice.
t l
C ost o f O pen-end
C redit

8

Open-end c e i includes c e i cards, department store “charge plates,” and
rdt
rdt
check-overdraft accounts that allow you to write checks f more than your actual
or
balance with the bank. Open-end c e i can be used again and again, generally u t l
rdt
ni
you reach a certain pre-arranged borrowing l m t Truth i Lending requires that (
ii.
n
open-end creditors l tyou know these two terms that w l a f c your c s s
e
il f e t
ot:
F r t creditors must tell you the method of calculating the
is,
finance charge. Creditors use a number of d fferent systems to calculate the
i
balance on which they assess finance charges. Some creditors add finance charges
a t r subtracting payments made during the b l i g period. This i called the a d ­
fe
iln
s
ju sted b alan ce m ethod. Other creditors give you no c e i for payments made
rdt
during the b l i g period. This i called the previous b alan ce m ethod. Under a
iln
s
third method — the a v erage daily balan ce m ethod — creditors add ypur

balances for each day i the b l i g period and then divide by the number of days
n
iln
i the b l i g period.
n
iln
Here’ a sample of three b l i g systems:
s
iln
ADJUSTED
BALANCE

Monthly I
nterest Rate
Previous Balance
Payments

It
n erest Charge

P R E V IO U S
BALANCE

A V E R A G E D A IL Y
BALANCE

1V2%
$400
$300

1V2%

V/2%

$400
$300

$400
$300 (payment on
15th day)

1.50

$ 6.00

$
($100 x 1.5%)

($400 x 1.5%)

$

3.75

(average balance of
$250 x 1.5%)

As the example shows, the finance charge varies considerably f the same
or
pattern of purchases and payments.
Second, creditors must tell you w hen finance charges begin on your
cr d t account, so you know how much time you have to pay your b l s before a
ei
il

finance charge i added. Some c e i o s f example, give you a 30 day “free ride”
s
r d t r , or
to pay your balance i f l before imposing a finance charge.
n ul
Truth i Lending does not s t the rates or tl the creditor how to make i t r s
n
e
el
neet
calculations — i only requires that the creditor tl you the method that w l be used.
t
el
il
You have the r g t to ask f r an explanation of any terms you don’ understand.
ih
o
t
L easin g C osts and
Term s

10

Leasing gives you temporary use of property i return f r periodic payments. I
n
o
t
has become a popular alternative to buying — under certain circumstances. For in­
stance, you might consider leasing furniture for an apartment you’luse only for a
l
year. The Truth i Leasing law requires leasing companies to give you the f c s
n
at
about the costs and terms of t e r contracts, to help you decide whether leasing i a
hi
s
good idea.
The law applies to p erson al property leased to you f more than four
or
months f r personal, family, or household use. I covers, f r example, long
o
t
o
term rentals of c r , f r i u e and appliances, but not daily car rentals or leases for
as untr,
apartments.
Before you agree to a l a e the leasing company must give you a written
es,
statement of costs, including the amount of any security deposit, the amount of
your monthly payments, and the amount you must pay f r l c n e r g s r t o ,
o ies, eitain
taxes, and maintenance.
The company must also give you a written statement about term s, including
any insurance you need, any guarantees, information about who i responsible fqr
s

servicing the property, standards for iswear and t a , and whether or not you have
t
er
an option to buy the property.
Your costs w l depend on whether you choose an “open end” lease or a
il
“closed end” lease. Open end leases usually offer lower monthly payments than
closed end leases, but you may owe a large extra payment — called a “balloon
payment” — based on the value of the property when you return i.
t
Suppose you lease a car under a 3-year open end l a e The leasing
es.
company estimates the car w l be worth $2,000 a t r 3 years of normal
il
fe
use. I you bring back the car i a condition that makes i worth only
f
n
t
$1500, you may owe a balloon payment of $500.
The leasing company must tl you whether you may owe a balloon payment
el
and how i w l be calculated. You should also know t a :
t il
ht
— you have the r g t to an independent appraisal of the property’ worth
ih
s
a the end of the le s . Y o u must pay the appraiser’ f e however.
t
ae
s e,
— the law usually l m t a balloon payment to no m ore than three
iis
tim es the average m onthly paym ent. I your monthly payment
f
i $100, your balloon payment can’ be more than $300 — unless, f r
s
t
o
example, the property has received more than average wear and tear
( o instance, i you drove a car more than average mileage).
fr
f

O p en -en d L e a se s and
B allo o n Paym ents

Closed end leases usually have a higher monthly payment than open end
leases, but there i no balloon payment a the end of the l a e
s
t
es.
A dvertising

Both Truth i Lending and Truth i Leasing require accurate advertising of
n
n
terms. These laws say that i a business mentions one important feature of a c e i
f
rdt
sale or lease — such as the downpayment — i must also s a e the APR and other
t
tt
important terms — such as the number, amount, and schedule of repayments. An
ad reading “Only $2 down,” for example, must also s a e that you w l have to pay
tt
il
$10 a week for the next two years. An ad must also specify i a leasing arrangement
f
i involved.
s

C osts o f Settlem ent
on a H o u se

A house i probably the single lar e t c e i purchase f r most consumers —
s
gs rdt
o
and one of the most complicated. The Real Estate Settlement Procedures Act, l k
ie
Truth i Lending, i a disclosure law. The Act, administered by the Department of
n
s
Housing and Urban Development, requires the lender to give you, i advance,
n
certain information about the costs you w l pay when you actually get the deed to
il
the property. This event i called settlement, and the law helps you shop f r lower
s
o
settlement c s s To find out more about i,you may write t : Assistant Secretary f
ot.
t
o
or
Consumer A fai s and Regulatory Functions, Attention: RESPA O f c , US/HUD,
f r
fie
451-7th S r
t eet, S.W„ Room 4100, Washington, D.C. 20410.
.

APPLYING FOR
CREDIT

Here’ the old s o y Mary and John Jones, whose j i t income i more than
s
tr:
on
s
i enough to make payments on t e r dream house, are turned down for a mortgage
hi
I loan. The lender says Mary might become pregnant and leave her j b
o.
That’ i l g l now. I’ i l g l even to discourage the Joneses from applying f r
s lea
ts l e a
o
a loan j s because Mary i of child-bearing age. And Mary’ income must be
ut
s
s
counted f l y by a lender.
ul
When you’ ready to apply for c e i , you should know what creditors think i
re
rdt
s
important i deciding whether you’ creditworthy. You should also know what
n
re
they cannot l g l y consider i t e r decisions.
eal
n hi
The law makes sure the creditor w l be fi:
il
ar
.

THE E Q U A L CREDIT OPPORTUNITY A C T s a t a l c
t r s l redit applicants
o f on the same footing. I says that race, color, age, sex, marital status —
f
t
and certain other factors — may not be used to discriminate against you
i any part of a credit dealing.
n

The O ld Story of
Discrim ination

W h at Law Applies?

13

W h a t C red itors
Look For

The Three C ’s. Creditors look for an a i i y to repay debt and a willingness
blt
to do so — and sometimes for a ltl extra security to protect t e r loans. They
ite
hi
speak of the three C ’ of c e i — capacity, character, and c l a e a .
s
rdt
oltrl

Capacity

Character

W l you repay the debt? Creditors w l look a your
il
il
t
c
redit history ( e chapter on Credit Histories and
se
Records): how much you owe, how often you bor­
row, whether you pay b l s on time, and whether you
il
l v within your means. They also look f r signs of
ie
o
s a i i y how long you’ liv d a your present ad­
tblt:
ve
e t
dress, whether you own or r n , and whether you are
et
insured.

Collateral
14

Can you repay the debt? Creditors ask f r employ­
o
ment information: your occupation, how long you’
ve
worked, how much you earn. They also want t
o
know your expenses: how many dependents you
have, or whether you pay alimony or child support.

I the creditor f l y protected i you fi to repay?
s
ul
f
al
Creditors want to know what you may have that

could be used to secure your loan, and what sources
you have f r repaying debt other than income, such
o
as savings, investments, or property.
Creditors use different combinations of these fac s i reaching t e r decisions.
t n
hi
Some s t unusually high standards and others simply do not make certain kinds of
e
loans. Creditors also use different kinds of rating systems. Some r l s r c l on t e r
e y tity
hi
own i s i c and experience. Others use a “credit scoring” or s a i t c l system to
ntnt
ttsia
predict whether you’ a good cr d t r s . They assign a certain number of points to
re
e i ik
each of various characteristics that have proved to be r l a l signs that a borrower
eibe
w l repay. Then, they rate you on t i s a e
il
hs cl.
And s , different creditors may reach different conclusions based on the same
o
s t of f c s One may find you an acceptable r s , while another may deny you a
e
at.
ik
loan.
The Equal Credit Opportunity Act does not guarantee that you w l get c e i .
il
rdt
You must sil pass the creditor’ t s s of creditworthiness. But the creditor must
tl
s et
apply these t s s f i l , impartially, and without discrimination against you on any of
e t ary
the following grounds: age, sex, marital s a u , race, c l r r l g o , national o i i ,
tts
oo, eiin
rgn
because you are on welfare or Social Security, or because you exercise your r g t
ihs
under Federal credit laws. This means that a creditor may not use any of those
grounds as an excuse t :
o

Information the
Creditor Can’t Use

15

— discourage you from applying f a loan;
or
— refuse you a loan i you q a i y
f
ulf;
— lend you money on terms d fferent from those granted another person
i
with sim l r income, expenses, c e i h s o y and c l a e a .
ia
rdt itr,
oltrl

Special R ules

A g e . Many older persons have complained about being denied c e i j s
r d t ut
because they were over a certain age. Or when they r t r d they may have found
eie,
that t e r credit was suddenly cut o f or reduced. So the law i very s e i i about
hi
f
s
pcfc
how a person’ age may be used i c e i decisions.
s
n rdt
A creditor may ask your age, but i you’e old enough to sign a binding contract
f
r
(usually 18 or 21 years old depending on State law), a creditor m ay not:

— turn you down or decrease your c e i j s because of your age;
rdt ut
— ignore your retirement income i rating your application;
n
— close your c e i account or require you to reapply for i j s because
rdt
t ut
you reach a certain age or r t r ;
eie
— deny you c e i or close your account because c e i lf insurance or
rdt
r d t ie
other credit-related insurance i not available to persons your age.
s
16

Creditors may “score” your age i a credit-scoring system, but:
n

— i you are 62 or older you must be given a l a t as many points f age
f
t es
or
as any person under 62.
Because age does have economic consequences, the law permits a creditor t
o
consider certain information related to age — such as how long u t l you r t r or
ni
eie
how long your income w l continue. An older applicant might not qualify for a large
il
loan with a 5 per cent down payment on a risky venture, but might qualify f r a
o
smaller loan — with a bigger down payment — secured by good c l a e a . Re­
oltrl
member that while a declining income may be a handicap i you are older, you can
f
usually o f r a s lid credit history to your advantage. The creditor has to look a al
fe
o
t l
the f c s and apply the usual standards of creditworthiness to your particular
at
stain
iuto.
P u blic A ssistan ce. You may not be denied c e i j s because you receive
r d t ut
Social Security or public assistance (such as Aid to Families with Dependent
Children). But — as i the case with age — certain information related to t i source
s
hs
of income could have a clear bearing on creditworthiness. So, a creditor may con­
sider such things a :
s

— how old your dependents are (because you may lose benefits when
they reach a certain age);
— whether you w l continue to meet the residency requirements f re­
il
or
ceiving ben f t .
eis

These factors help the creditor determine the likelihood that your public assistance
income w l continue.
il
H ousin g Loans. The Equal Credit Opportunity Act covers your application
for a mortgage or home improvement loan. I bans discrimination because of such
t
characteristics as your race, c l r sex, or because of the race or national o
oo,
rigin of
the people i the neighborhood where you l v or want to buy your home. Nor may
n
ie
creditors use any appraisal of the value of your property that considers the race of
the people i your neighborhood.
n
Another Federal law, the H om e M ortgage D isclosure A ct, requires that
most lending i s i u i n i metropolitan areas tl the public annually where they
ntttos n
el
have made t e r mortgage and home improvement loans. This information does
hi
not tl you where loans were denied or why — i can’ be used to prove discrimi­
el
t
t
nation — but i can help customers, community groups, and l c l o f c a s working
t
o a fiil
with lenders to meet neighborhood needs f housing c e i . You can ask to see the
or
rdt
information a any time a your bank, savings and loan, or c e i union. Those in­
t
t
rdt
terested i l c l cooperative e f r s to increase mortgage lending and improve
n oa
fot
housing i urban areas, may write to the Urban Reinvestment Task Force, 1120
n
19th S reet, N.W., Washington, D.C. 20036.
t
.

Both men and women are protected from discrimination based on sex or
marital s a u . But many of the law’ provisions were designed to stop particular
tts
s
abuses that generally made i d f i u t for women to get c e i . For example, the
t ifcl
rdt
notion that single women ignore t e r debts when they marry, or that a woman’
hi
s
income “doesn’ count” because she’lleave work to have children, now i unlawful
t
l
s
i c e i transactions.
n rdt
The general rule i that you m ay not be denied credit just becau se
s
you are a w o m an , or just beca u se you are m arried, single, w id o w ed ,
divorced, or sep arated . Here are some important protections:
Sex and
Generally, creditors may not ask your sex on an
Marital Status application form (one exception i on a loan to buy
s
or build a home).
You do not have to use Miss, Mrs , or Ms. with your
.
name on a c e i application. But, i some cases, a
rdt
n
creditor may ask whether you are married, unmar­
r e , or separated (unmarried includes s n l , di­
id
ige
vorced, and widowed).

Discrim ination
A gain st W om en

Child-bearing Creditors may not ask about your b r h control
it
Plans
practices or whether you plan to have children, and
they may not assume anything about those plans.
Income and The creditor must count al of your income, even
l
Alimony
income from part-time employment.
Child support and alimony payments are a primary
source of income f r many women. You don’ have
o
t
to disclose these kinds of income, but i you do
f
creditors must count them.
Telephones Creditors may not consider whether you have a
telephone l s i g i your name because t i would
itn n
hs
discriminate against most married women. (You
may be asked i there’ a telephone i your home.)
f
s
n
A creditor may consider whether income i steady and r l a l , so be pre­
s
eibe
pared to show that you can count on uninterrupted alimony payments or part-time
wages. I you’ pregnant when you apply for a loan, bring some proof that you’lbe
f
re
l
paid during maternity leave or that your job w l be open for you when you return.
il
(Before you go to apply, ask the creditor what proof i acceptable.)
s

Y o u r ow n accounts. Many married women used to be turned down when
they asked for credit i t e r own name. Or, a husband had to co-sign an account —
n hi
agree to pay i the wife didn’ — even when a woman’ own income could e s l
f
t
s
aiy
repay the loan. Single women were refused loans because they were judged some­
how l s “reliable” than other applicants. You now have a r g t to your own c e i ,
es
ih
rdt
based on your own credit records and earnings. Your own c
redit means a separate
account or loan i your own name — not a j i t account with your husband or a
n
on
duplicate card on h s account. Here are the r l s
i
ue:

— Creditors may not refuse to open an account j s because of your sex
ut
or marital s a u .
tts
— You can choose to use your frt name and maiden name (Mary
is
Smith); your frt name and husband’ l s name (Mary Jones); or a
is
s at
combined l s name (Mary Smith-Jones).
at
— I you’ creditworthy, a creditor may not require your husband to co­
f
re
sign your account, with exceptions i “community property States,”
n
where husbands and wives are equally responsible for each other’
s
debts.
— Creditors may not ask for information about your husband or ex­
husband when you apply f r your own c
o
redit based on your own
income — unless that income i alimony, child support, or separate
s
maintenance payments from your spouse.

This l s r l , or course, does not apply i your husband i going to use your account
at u e
f
s
or i responsible f paying your debts, or you l v i a community property S a e
s
or
ie n
tt.
(Community property States a e Arizona, California, Idaho, Louisiana, Nevada,
r:
New Mexico, Texas, and Washington.)
C h an ge in M arital Status. Married women have sometimes faced severe
hardships when cut o f from c e i a t r t e r husbands died. Single women have
f
rdt fe hi
had accounts closed when they married, and married women have had accounts
closed a t r a divorce. The law says that creditors may not require you to reapply
fe
for credit j s because you marry or become widowed or divorced. Nor may they
ut
close your account or change the terms of your account on these grounds. There
must be some sign that your creditworthiness has changed. For example, creditors
m ay ask you to reapply i you r
f
elied on your ex-husband’ income to get c e i i
s
rdt n
the frtplace.
is
Setting up your own account protects you by giving you your own history of
debt management to r l on i circumstances do change because of widowhood or
ey
f
divorce. I you’ getting married and plan to take your husband’ surname, write to
f
re
s
your creditors and tl them i you want to keep a separate account.
el
f

Remember, your sex or race may not be used to discourage you from applying
f a loan. And creditors may not delay your application on those grounds. Under
or
the Equal Credit Opportunity Act, you must be notified within 30 days a t r your
fe
application has been completed whether your loan has been approved or not. I
f
c e i i denied, t i notice must be i writing and i must explain the s e i i
rdt s
hs
n
t
pcfc
reasons for denying credit or tl you of your r ght to request an explanation. You
el
i
have the same r g t i an account you have had i closed.
ihs f
s

If Y o u ’re T urned
D ow n

I you are denied c e i , be sure to find out why. Remember, you may have to
f
rdt
ask the creditor for t i explanation. I may be that the creditor thinks you have re­
hs
t
quested more money than you can repay on your income. I may be that you have
t
not been employed or lived i the community long enough. You can discuss terms
n
with the creditor and ways to improve your creditworthiness. The next chapter ex­
plains how to improve your a i i yto get c e i .
blt
rdt
I you think you have been discriminated against, c t the law to the lender. I
f
ie
f
the lender sil says no without a satisfactory explanation, you may contact a
tl
Federal enforcement agency fo assistance or bring leg l action as described i the
r
a
n
l s chapter of t i handbook.
at
hs

23

CREDIT
HISTORIES
AND RECORDS

Building Up a
Good Record

On your frtattempt to get c e i , you may face a common f u t a i n some­
is
rdt
rsrto:
times i seems you have to have c edit to get c e i . Some creditors w l rely e t r l
t
r
rdt
il
niey
on your salary and job and the other f nancial information you supply on your ap­
i
p i a i n But most also want to know about your experience i handling c e i —
lcto.
n
rdt
how r l a l you’ repaid past debts. They turn to the records kept by c e i
eiby
ve
rdt
bureaus or credit reporting agencies whose business i to c l e t and store informa­
s
olc
tion about borrowers that i routinely supplied by many lenders. These records in­
s
clude the amount of c e i you have received and how f i h u l you’ paid i
rdt
atfly
ve
t
back.
Here are several ways you can begin to build up a good c edit h s o y
r
itr:
— Open a checking account or a savings account, or both. These do not
begin your c
redit fl, but may be checked as evidence that you have
ie
money and know how to manage i.Cancelled checks can be used to
t
show you pay u i i i sor rent b l sregularly, a sign of r l a i i y
tlte
il
eiblt.
— Apply for a department store c edit card. Repaying c e i card b l son
r
rdt
il
time i a plus i c e i h s o i s
s
n r d t itre.

— I you’ new i town, write for a summary of any c
f
re
n
redit record kept by
a credit bureau i your former town. (Ask the bank or department
n
store i your old home town for the name of the agency i reports t .
n
t
o)
— Ask a friend or rela i e with a good credit standing to co-sign an appli­
tv
cation with you for your frtaccount.
is
— I you’ turned down, find out why and t y to clear up any misunder­
f
re
r
standings.

The following laws can help you s a t your credi history and keep your record
tr
t
accurate:

W hat Laws Apply?

- THE E Q U A L CREDIT OPPORTUNITY A C T gives women a way to
establish t e r own credit history and i e t t .
hi
dniy
— THE FAIR CREDIT REPORTING A C T set up a procedure for cor­
s
recting mistakes on your cr d t record.
ei

25

C redit H istories
fo r W om en

Women who are divorced or widowed might not have separate c e i h s o i s
rdt itre
because al past c
l
redit accounts were l s e i t e r husbands’names. But they can
itd n h i
benefit from t i record. Under the Equal Credit Opportunity Act, creditors must
hs
consider the cre i history of any account women have held j i t y with t e r hus­
dt
onl
hi
bands. Creditors must also look a the record of any account held only i the
t
n
husband’ name i a woman can show i also r f e t her own creditworthiness. I
s
f
t
elcs
f
the record i unfavorable — i an ex-husband was a bad c
s
f
redit r s — she can t y t
ik
r o
show that the record does not r f e t her own reputation.
elc

Here’ an example:
s
Mary Jones, when married to John Jones, always paid t e r credit-card
hi
b l son time and from her own checking account. But the card was issued
il
i John’ name, and the c e i bureau kept al records i John’ name.
n
s
rdt
l
n
s
Now Mary i a widow and wants to take out a new card, but she’ told
s
s
she has no c e i h s o y To benefit from the good c e i record already
rdt itr.
rdt
on the books i John’ name, Mary should point out that she handled al
n
s
l
accounts properly when she was married and that b l s were paid by
il
checks from her own account.

26

Married women probably won’ have Mary’ problem i the futu e Under the
t
s
n
r.
Equal Credit Opportunity Act, reports to c e i bureaus must now be made i the
rdt
n

names of both husband and wife i both use an account or are responsible for re­
f
paying the debt. Remember that a wife may also open her own account to be sure
of s a t n her own credit h s o y
trig
itr.
Mistakes on your credit record — sometimes mistaken i e t t e — can cloud
dniis
your c e it future. Your credit rating i important, so be sure c
rd
s
redit bureau records
are complete and accurate.
The Fair Credit Reporting Act says that you may examine information i your
n
c e i fl and have any errors corrected.
r d t ie
N egative Inform ation. I a lender refuses you c e i because of unfavor­
f
rdt
able information i your credit report, ask for the name and address of the agency
n
that keeps your report. Then, you may either request information from the c e i
rdt
bureau by mail or i person. You w l not get an exact copy of the fl,but you w l a
n
il
ie
il t
l a t get a summary of i.The law also says that the c e i bureau must help you
es
t
rdt
interpret the data — because i’ raw data that takes experience to analyze. I you’
ts
f
re
challenging a cr d t refusal made within the past 30 days, the bureau may not
ei
charge a fee for giving you information.
Any error of importance that you find must be investigated by the c e i
rdt
bureau with the creditor who supplied the data. The bureau w l remove from your
il
c e i fl any errors the creditor admits are there. I you disagree with the f ndings,
r d t ie
f
i
you can fl a short statement i your record giving your side of the s o y Future re­
ie
n
tr.
ports to creditors must include t i statement or a summary of i.
hs
t

O ld Inform ation. Sometimes c e i information i too old to give a good
rdt
s
picture of your f nancial reputation. There i now a l m t on how long certain kinds
i
s
ii
of information may be kept i your fl:
n
ie

— Bankruptcies must usually be removed from your c edit history a t r
r
fe
14 years.
— Suits and judgments, tax l e s a r s records, and most other kinds of
in, r e t
unfavorable information must usually be removed a t r 7 years.
fe
Another important provision of the law i that you may withhold your c e i
s
rdt
record from anyone who does not have a legitimate business need for i.Stores to
t
which you are applying f c e i or prospective employers may examine your
or r d t
record; curious neighbors may n t
o.
B illing M istakes. I the next chapter, you w l find the steps to take i there’
n
il
f
s
an error on your bl.By following these s
il
teps, you can protect your c e i r t n .
rdt aig

CORRECTING
CREDIT
MISTAKES

The best way to keep up your credit standing i to repay al debts on time. But
s
l
there may be complications. To protect your cred t — to save your time, your
i
money, and your future credit rating — you should learn how to correct the mis­
takes and misunderstandings that can tangle up your c e i accounts.
rdt
When there’ a snag, f rt t y to deal d r ctly with the c e i o . The c
s
is r
ie
rdtr
redit laws
can help you s t l your complaints without a hassle.
ete
— THE FAIR CREDIT BILLING A C T s t up a procedure for promptly
es
correcting b l i g mistakes; for refusing to make c edit card payments
iln
r
on defective goods; and for promptly crediting your payments.
— TRUTH IN LENDING gives you 3 days to change your mind about a
second mortgage contract; i also l m t your r s on l s or stolen c e i
t
iis
ik
ot
rdt
cards.
Month a t r month John Jones was b l e for a lawn mower he never ordered
fe
ild
and never got. F n l y he tore up h s bl and mailed back the pieces — j s to t y t
ial,
i il
ut
r o
explain things to a person instead of a computer.
. There’ a more e f c i e easier way to straighten out these e r r . The Fair
s
fetv,
ros

W hat Laws Apply?

B illing E rrors

Credit B l i g Act requires creditors to correct errors promptly and without damage
iln
to your credit r t n .
aig
A Case of Error? The law defines a b l i g error as any charge:
iln

— for something you didn’ buy or f a purchase made by someone not
t
or
authorized to use your account;
— that i not properly i e t
s
d n ified on your bl or i for an amount d f e e t
il
s
ifrn
from the actual purchase price or was entered on a date d fferent from
i
the purchase date;
— for something that you did not accept on delivery or that was not de­
livered according to agreement.
B l i g errors also include:
iln
— errors i arithmetic;
n
— f i u e to r f e t a payment or other c e i to your account;
alr
elc
rdt
— f i u e to mail the statement to your current address, provided you
alr
notified the creditor of an address change a l a t 10 days before the
t es
end of the b l i gperiod;
iln
— a questionable item, or an item for which you need additional infor­
mation.

In C a s e o f E rror. I you think your bl i wrong, or want more information
f
il s
about i,follow these s e s
t
tp:
1 Notify the creditor in writing within 60 days a t r the bl was mailed. Be
.
fe
il
sure to write to the address the creditor lss for b l i g inquiries and to tl the
it
iln
el
ceio:
rdtr

— your name and account number;
— that you believe the bl contains an error and w hy you believe i i
il
ts
wrong;
— the suspected amount of the error or the item you want explained.
2 Pay al parts of the bl that are not i dispute. But, while waiting f r an
.
l
il
n
o
answer, you do not have to pay the amount i question ( h “disputed amount”)or
n
te
any minimum payments or finance charges that apply to i.
t
The creditor must acknowledge your l t e within 30 days, unless your bl can
etr
il
be corrected sooner. Within two b l i g periods — but i no case longer than 90
iln
n
days — either your account must be corrected or you must be told why the creditor
believes the bl i correct.
il s
I the creditor made a mistake, you do not pay any finance charges on the dis­
f
puted amount. Your account must be corrected, and you must be sent an explana­
tion of any amount you sil owe. You then have the time usually given on your
tl
type of account to pay any balance.

I no error i found, the creditor must promptly send you a statement of what
f
s
you owe, and may include any finance charges that have accumulated and any
minimum payments you missed while you were questioning the bl.
il
3
.
I you sil are not s t s i d you should n
f
tl
aife,
otify the creditor within the time
allowed to pay your bl.
il
M aintaining Y o u r C redit Rating. A creditor may not threaten your c e i
rdt
rating while you’e resolving a b l i g dispute.
r
iln
Once you have written about a possible e r r a creditor i prohibited from
ro,
s
giving out information to other creditors or c e i bureaus that would damage your
rdt
credit reputation. And, u t l your complaint i answered, the creditor also may not
ni
s
take any action to c l e t the disputed amount.
olc
After the creditor has explained the bl,you may be reported as delinquent on
il
the amount i dispute, and the creditor may take action to c l e t i you do not pay
n
olc f
i the time allowed. Even s , you can sildisagree i w i i g Then the creditor must
n
o
tl
n rtn.
report that you have challenged your bl and give you the name and address of
il
each person who has received information about your account. When the matter i
s
s t l d the creditor must report the outcome to each person who has received in­
ete,
formation. Remember that you may also place your own side of the story i your
n
c e i record.
rdt

Your new sofa arrives with only three l g . You t y to return i;no l c . You
es
r
t
uk
ask the merchant to repair or replace i;silno luc . The Fair Credit B l i g Act pro­
t tl
k
iln
vides that you may withhold payment on any damaged or shoddy goods or poor
quality services purchased with a credit card, as long as you have made a r a at­
el
tempt to solve the problem with the merchant.
This r g t i limited i the card was a bank or travel and entertainment card or
ih s
f
any card not issued by the store where you made your purchase. I such cases, the
n
sl:
ae

D efective G o o d s
or Services

— must have been fo more than $50; and
r
— must have taken place i your home State or within 100 miles of your
n
home address.
I you can avoid finance charges on your account by paying within a certain
f
amount of time, i i obviously important that you get your bls and get c
ts
il,
redit f r
o
paying them, promptly. Check your statements to make sure your creditor follows
these r l s
ue:

Prom pt C redit for
Paym ents and
R efunds for
O verpaym ents

Prom pt Billing. Look a the date on the postmark. I your account i
t
f
s

one on which no finance charge i added before a certain due date,
s

33

then creditors must mail t e r statements a l a t 14 days before pay­
hi
t es
ment i due.
s
P ro m p t Crediting. Look a the payment date entered on the state­
t
ment. Creditors must c edit payments on the day they a r v .
r
rie
Stores often give you a c e i on your bl instead of cash when you return a
rdt
il
purchase. I t i r s l s i an overpayment on your account, a store must make a
f hs e u t n
refund i cash, a your request.
n
t

C an cellin g a
S econd M ortgage

34

Truth i Lending gives you a chance to change your mind on one important
n
kind of transaction — when you use your home as security f a c
or redit transaction.
For example, when you are financing a major repair or remodeling, you have three
business days to think about the transaction and to cancel i i you wish. The
t f
creditor must give you written notice of your r g t to cancel, and, i you decide to
ih
f
cancel, you must notify the creditor i writing within the 30 day period. No con­
n
tractor may s a t work on your home, and no lender may pay you or the contractor
tr
u t l the three days are up. I you want work started immediately f health or
ni
f
or
safety reasons, you may give up your r g t to cancel by providing a written explana­
ih
tion of the circumstances.
This r g t to cancel ( r r g t of “rescission”) was provided to protect you
ih
o ih
against hasty decisions — or decisions made under pressure — that might endanger
your continued homeownership. The law does not apply to a frt mortgage to
is

finance the purchase of your home; fo t a , you commit yourself as soon as you
r ht
sign the mortgage contract.
“Who st a s my purse. . j s might be a t r the c e i card i i. But, your
el
ut
fe
rdt
n t
greatest cost may be inconvenience, because your l a i i y on l s or stolen c
iblt
ot
redit
cards i limited under Truth i Lending.
s
n
You do not have to pay for any unauthorized charges made after you n
otify
the card company of loss or t e t of your card. So keep a ls of your c
hf
it
redit card
numbers and notify card issuers immediately i your card i l s of s o e . The most
f
s ot
tln
you w l have to pay for unauthorized charges i $50 on each card — even i some­
il
s
f
one runs up several hundred dollars worth of charges before you report a card
missing.
To protect you f r her, card companies may not c l e t from you for any l s
ut
olc
os
unless they can prove four things:
1 that they issued you the card at your request or that you used i a l a t
.
t t es
once before i was l s or s olen;
t
ot
t
2 that they provided some means, such as a l n for your signature or a
.
ie
photo, for stores that accept the card to i e
d ntify you as the person
authorized to use i;
t
3 that they notified you of your potential $50 l a i i y
.
iblt;
4 that they provided you with a self-addressed stamped form to n
.
otify
them of loss or t e t
hf.

Lost or Stolen
C redit C ard s

35

U nsolicited C ard s

I i i l g lfor card issuers to send you a c e i card unless you request i.H o w ­
t s lea
rdt
t
ever, a card issuer may send you, without your request, a new card to replace an
expired one.

Discounts for Cash
Payments

I i i l g l for credit-card companies to prohibit stores from offering discounts
t s lea
to people who pay by cash or check. Stores that do o fer cash discounts must make
f
t i f c clear to al buyers. They may not add an extra charge (above the regular
hs at
l
pr c ) f r those customers choosing t use c e i cards.
ie o
o
rdt
For example, suppose you want to buy an item regularly priced a $50. The
t
store offers a cash discount of 5 per cent. I you pay i cash, your price should be:
f
n
$50.00
-2.50 (5% of $50)
$47.50

36

I you use a cred t card, the price i $50.
f
i
s

COMPLAINING
ABOUT CREDIT
COMPLAINT DESK
J*

Always t y to solve your problem d r c l with a c e i o . Only then should you
r
iety
rdtr
bring more formal complaint procedures. Here’ the way to fl a complaint with the
s
ie
Federal agencies responsible for administering consumer c e i protection laws.
rdt
C om plaints about B anks. I you have a complaint about a bank i con­
f
n
nection with any of the Federal credit laws — or i you think any part of your busi­
f
ness with a bank has been handled i an unfair or deceptive way — you may get
n
advice and help from the Federal Reserve.
You should submit your complaint — i writing whenever possible — to the
n
Director of the Division of Consumer A f i s Board of Governors of the Federal
far,
Reserve System, Washington, D.C. 20551, or to the Reserve Bank for your d s r c ,
itit
as l s e on page 45 of t i handbook. Be sure to describe the bank practice to
itd
hs
which you object and give the name and address of the bank involved.
The Federal Reserve w l acknowledge your l t e and t y to respond i f l
il
etr
r
n ul
within 15 days. I that i not possible, our reply w l s t a reasonable date for furnish­
f
s
il e
ing you with complete information.
The Board has supervisory responsibility only f r State-chartered banks that
o
are members of the Federal Reserve System. I w l refer complaints about other
t il

C om plaining to
F ed eral Enforcem ent
A gen cies

i s i u i n to the appropriate Federal bank regulatory agency and l t you know to
ntttos
e
whom your complaint has been referred. Or you may use the l s i g on page 44 of
itn
t i booklet to write d r c l to the appropriate agency.
hs
iety
The practice you wish to complain about does not have to be subject to
Federal regulation. Furthermore, you don’ have to be a customer of the bank to fl
t
ie
a complaint.
Complaints about Other Businesses. On page 44 of t i booklet, you
hs
w l also find the names of the regulatory agencies for businesses other than banks.
il
Many of these agencies do not handle individual complaints; however, they w l use
il
information about your c
redit experiences to help enforce the c e i laws.
rdt

Pen alties U n d er
the L aw s

You may also take l gal action against a c e i o . I you decide to bring a law­
e
rdtr f
s i ,here are the penalties a creditor must pay i you win.
ut
f

38

Truth in Lending and C on sum er L easin g A ct. I any creditor f i s to
f
al
disclose information required under Truth i Lending or Truth i Leasing, or gives
n
n
inaccurate information, or does not comply with the rules about c e i cards or the
rdt
r g t to cancel, you as an individual may sue for actual damages — any money l s
ih
os
you s f e . I addition, you can sue for twice the finance charge i the case of a
ufr n
n
c
redit transaction, o , i a lease i concerned, 25 per cent of t t l monthly payments.
r f
s
oa
I either case, the l a t the court may award you i $100, and the most i $1,000. I
n
es
s
s
n
any successful la suit, you are e t t e to court costs and attorney’ f e .
w
nild
s es
Class action s i s are also permitted. A c ass action s i i one f l d on behalf of
ut
l
ut s
ie
a group of people with similar claims.

Equal Credit Opportunity Act. I you think you can prove that a creditor
f
f a discriminated against you for any reason prohibited by the Act, you as an in­
is
dividual may sue for actual damages plus punitive damages — that i,damages for
s
the f c that the law has been violated — of up to $10,000 i the violation i proved
at
f
s
to have been intentional. I a successful lawsuit, the court w l award you court costs
n
il
and a reasonable amount for attorney’ f e . Class action s i s are also permitted.
s es
ut

Fair C redit Billing. A creditor who f i s to comply with rules applying to
al
the correction of b l i g errors automatically f r e t the amount owed on the item i
iln
ofis
n
question and any finance charges on i,up to a combined t t l of $50 — even i the
t
oa
f
bl was c
il
orrect. You as an individual may also sue for actual damages plus twice the
amount of any finance charges, but i any case not l s than $100 nor more than
n
es
$1,000. You are also ehtitled to court costs and attorney’ fees i a successful law­
s
n
s i . Class action s i s are also permitted.
ut
ut

Fair C redit R eporting. You may sue any c e i reporting agency or
rdt
creditor fo violating the rules about who may have access to your c
r
redit records
and correcting errors i your fl. Again, you are e t t e to actual damages, plus
n
ie
nild
punitive damages as the court may allow i the violation i proved to have been in­
f
s
te t onal. I any successful lawsuit, you w l also be awarded court costs and at­
ni
n
il
torney’ f e . An unauthorized person who secures a c e i report — or any e m ­
s es
rdt
ployee of a credit reporting agency who supplies a c e i report to unauthorized
rdt
persons — may be fined up to $5,000 or imprisoned for one year, or both.

GLOSSARY*

Annual Percentage Rate

Appraisal Fee
Asset
Balloon Payment
B l i g Error
iln
Collateral
Co-signer
Credit

Credit Bureau
Credit Card

40

Credit History

The cost of a loan over a f l year expressed as a per­
ul
centage.
_
The charge for estimating the value of property offered
as s c r t .
euiy
,
Property that can be used to repay debt, such as stocks
and bonds or a c r
a.
A large extra payment that may be charged a the end of
t
a loan or l a e
es.
Any mistake i your monthly statement as defined by the
n
Fai Credit B l i g Act.
r
iln
Property offered to support a loan and subject to seizure
i you d f u t
f
eal.
Another person who signs your loan and assumes equal
l a i i yf r i.
iblt o t
The promise to pay i the future i order to buy or bor­
n
n
row i the present; a sum of money due a person or a
n
business.
An agency that keeps your credit record.
Any card, p a e or coupon book used from time to time
lt,
or over and over again up to a certain l m t to borrow
ii
money or buy services on c e i .
rdt
The record of how you’ borrowed and repaid debts. .
ve

Creditor

A person or business from whom you borrow or to whom
you owe money.

Credit-related Insurance Health, lf, or accident insurance designed to pay the
ie
outstanding balance of debt.
Credit Scoring System

A s a i t c l system used to rate c e i applicants ac­
ttsia
rdt
cording to various characteristics relevant to credit­
worthiness.

Creditworthiness

Past and future a i i yto repay debts.
blt

Default

Failure to meet the terms of your c e i agreement.
rdt

Disclosure

Information that must be given to consumers before they
sign a credit contract.

Elderly Applicant

As defined i the Equal Credit Opportunity Act, a person
n
62 or older.

Finance Charge

The t t l dollar amount paid to get a loan.
oa

Joint Account

A cre i account signed by two or more people so that al
dt
l
can use the account and alassume l a i i yto repay.
l
iblt

Judgmental System

A nonstatistical system for evaluating creditworthiness.

Late Payment

A payment made l t r than agreed upon i a c e i con­
ae
n rdt
t a t and on which additional i t r s may be charged.
rc
neet

Lessee

A person who signs a lease to get temporary use of
property.

Lessor

A company that provides temporary use of property
usually i return for periodic payment.
n

Liability on an Account

Legal responsibility to repay debt.

Open End Credit

A l n of c e i that may be used over and over again tp
ie
rdt
to a certain borrowing l m t also called a charge account
ii,
or revolving c e i .
rdt

Open End Lease

A lease which may involve a balloon payment based on
the value of the property when i i returned.
ts

Overdraft Checking
Account

A l n of c e i that allows you to write checks f more
ie
rdt
or
than your actual balance, with an i t r s charge on the
neet
overdraft.

Points

Some extra per cent of the amount borrowed, included
as part of your loan f e Finance charges paid a the be­
e.
t
ginning of a frtmortgage i addition to monthly i t r s ;
is
n
neet
each point equals one per cent of the amount financed.

Punitive Damages

Damages awarded by a court above actual damages as
punishment f r a violation of law.
o

Rescission

The cancellation of a contract.

Security

Property pledged to the creditor i case of a default on a
n
loan; see c l a e a .
oltrl

Security I t r s
neet

The creditor’ r g t to take property or a portion of prop­
s ih
erty offered as s c r t .
euiy

Service Charge

A component of some finance charges, such as the fee
f triggering an overdraft checking account i t use.
or
no

‘The regulations contain l g l definitions of many of these terms.
ea

Subject Index

P a ge

A dvertising .................................................................... . . . . 12
A g e ......................................................... ____ 16
A P R ....................................................... . . . .
6
Balloon Paym ent.................................... . . . . 11
Billing Errors ................................................................. . . . . 33
Cancellation (Rescission).................................... ______ 34
Cash Discounts...................................... . . . . 36
Com plaints............................................ . . . . 37
Credit A pplications................................ . . . . 13
Credit B u reau s...................................... . . 24, 27
Credit C a rd s .......................................... . . . . 35
Crediting of Paym ents .......................................... . . . . 33
Credit Laws
Consumer Leasing ............................................. ........
5
Equal Credit Opportunity................... ........ 13
Fair Credit Billing................................ . . . . 29
Fair Credit Reporting......................... ........ 25
Home Mortgage Disclosure....................... 18
12
Real Estate Settlement Procedures . . . . .
Truth in L e n d in g ............................... . . . .
5
Credit Records
Confidentiality.................................. ............. 28

CorrectingErrors.......................................... 27
Time Limits on Inform ation....................... 28
W o m e n ....................................................... 26
Credit Scoring...................................... ........ 15
Creditworthiness.................................. ........ 14
Defective Merchandise.......................... ........ 33
Denials of C re d it .................................................... ........ 23
Discrimination ...................................................... . . . 13,19
Division of Consumer A ffairs............... ........ 37
Enforcement Agencies......................... ........ 44
6
Finance C harge.................................... ........
Housing L o a n s .................................... ........ 18
Leasing................................................. ........ 10
Open End C redit.................................. ............. 8
Penalties............................................... ............. 38
Public Assistance .................................................... ............. 17
Reserve Banks.......................................................... ............. 45
Settlement C osts.................................. ........ 12
Women
Alimony and Support Payments. . . . ........ 20
. . . .
22
Change in Marital S ta tu s ................
........ 21
Credit Histories fo r ........................... . . . . 26
Information About Spouse............... . . . . 21
Separate Accounts ....................................... ........ 21

Federal Enforcement Agencies
National Banks
Comptroller of the Currency
Consumer Affairs Division
Washington, D.C. 20219
State M em ber Banks
Federal Reserve Bank serving the district in
which the State member bank is located.
N onm em ber Insured Banks
Federal Deposit Insurance Corporation Re
gional Director for the region in which the
nonmember insured bank is located.
Savings Institutions Insured by the FSLIC
and M em bers of the FH LB System (ex­
cept for Savings Banks insured by
F D IC )
The Federal Home Loan Bank Board Super­
visory Agent in the district in which the insti­
tution is located.
Federal Credit U nions
Regional Office of the National Credit Union
Administration serving the area in which the
Federal Credit Union is located.

44

Creditors Subject to Civil Aeronautics
Board
Director, Bureau of Enforcement
Civil Aeronautics Board
1825 Connecticut Avenue, N.W.
Washington, D.C. 20428

Creditors Subject to Interstate
m erce C om m ission
Office of Proceedings
Interstate Commerce Commission
Washington, D.C. 20523

Com ­
•

Creditors Subject to Pack ers and Stock­
yards Act
Nearest Packers and Stockyards Administra­
tion area supervisor.
Sm all Business Investment Com panies
U.S. Small Business Administration
1441 L Street, N.W.
Washington, D.C. 20416
Brokers and Dealers
Securities and Exchange Commission
Washington, D.C. 20549
Federal Land Banks, Federal Land Bank
A s s o c ia t io n s , F e d e ra l In te rm e d ia te
Credit Banks and Production Credit
A ssociation
Farm Credit Administration
490 L'Enfant Plaza, S.W.
Washington, D.C. 20578
Mortgage Bankers, C onsum er Finance
Com panies, and A ll Other Creditors
FTC Regional Office for region in which the
creditor operates or
Federal Trade Commission
Equal Credit Opportunity
Washington, D.C. 20580
.
Any complaints may be referred to the Civil
Rights Division of the Department of Justice,
Washington, D.C. 20530.

Federal Reserve Banks

BOARD OF G OVERNORS OF THE
FEDERAL RESERVE SYSTEM
20th and Constitution Avenue, N.W.
Washington, D.C. 20551
(202) 452-3000

D A LLAS, Texas
400 South Akard Street
Station K
ZIP 75222
(214) 651-6111

RICHMOND, Virginia
701 East Byrd Street
P.O. Box 27622
ZIP 23261
(804) 643-1250

A T L A N T A , Georgia
104 Marietta Street, N.W.
ZIP 30303
(404) 586-8500

K A N S A S CITY, Missouri
925 Grand Avenue
Federal Reserve Station
ZIP 64198
(816) 881-2000

SA N FRANCISCO, California
400 Sansome Street
P.O. Box 7702
ZIP 94120
(415) 544-2000

M INNEAPOLIS, Minnesota
250 Marquette Avenue
ZIP 55480
(612) 340-2345

ST. LOUIS, Missouri
411 Locust Street
P.O. Box 442
ZIP 63166
(314) 444-8444

BOSTON, Massachusetts
600 Atlantic Avenue
ZIP 02106
(617)973-3000
CH ICAG O , Illinois
230 South LaSalle Street
P.O. Box 834
ZIP 60690
(312) 322 5322

NEW YORK, New York
33 Liberty Street
Federal Reserve P.O. Station
ZIP 10045
(212) 791-5000

CLEVELAND, Ohio
1455 East Sixth Street
P.O. Box 6387
ZIP 44101
(2J 6) 241-2800

PH ILAD ELPH IA, Pennsylvania
100 North Sixth Street
P.O. Box 66
ZIP 19105
(215) 574-6000

45

Other Consumer Pamphlets Available

What Truth I Lending Means to You
n
I You Borrow To Buy Stock
f
How To F l a Consumer Credit Complaint
ie
The Equal Credit Opportunity Actand . . Age
.
The Equal Credit Opportunity Actand . . Women
.
The Equal Credit Opportunity Actand . .Doctors,Lawyers, Small Retailers
.
The Equal Credit Opportunity Actand . . Credit Rightsi
.
n
Housing
Fair Credit B l i g
iln
Truth i Leasing
n
A Guide to Federal Reserve Regulations
Annual Percentage Rate Tables
Government i the Sunshine/A Guide to Meetings of the Board of Governors of
n
the Federal Reserve System
I You Use a Credit Card
f

46

Copies of t i handbook and other consumer pamphlets are available upon request
hs
from Publications Services, Division of Administrative Services, Board of Gover­
nors of the Federal Reserve System, Washington, D.C. 20551.
.


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102