Chapter 18 - Chapter 18 Lesson Chapter 18 Lesson 18 - Legal...

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Chapter 18 Lesson Chapter 18 Lesson 18 - Legal Rights of Consumers, Debtors, and Creditors OBJECTIVES: After completing this lesson, the required reading, and the assignments, learners will be able to: 1. Explain the various laws that protect consumers. 2. Determine how to collect on a bad debt . 3. Describe the concept of collateral and how to perfect a security interest. 4. Understand the purpose and effect of bankruptcy, and the differences among Chapter 7, Chapter 11, and Chapter 13 bankruptcy. Consumer-Related Issues This section of Chap. 18 covers several statutes which relate to consumer credit issues. I do not expect you to remember the names of each of them. Instead, focus on what I've included in this lesson - and on the main provisions of each statute discussed below. Establishing Credit / Good Credit History I think most of you probably have a decent understanding of how to establish good credit Your book has a good explanation of what is involved in a credit check. The Fair Credit Reporting Act governs credit reporting companies' obligations to consumers about whom they compile credit information. For instance, consumers are entitled to be notified if anyone orders an investigative report on them. Employers must get permission before obtaining a credit report on a prospective employee. If a consumer is denied credit based on a negative credit report, the consumer is entitled to receive a summary of the report for free. Disclosing Credit Costs The Uniform Commercial Credit Code (UCCC) (which is extremely easy to confuse with the UCC, which we covered in Chapters 12 and 13) and the Truth in Lending Act are each disclosure statutes which require creditors to fully disclose all credit terms to consumers. The Fair Credit Billing Act and the Fair Debt Collection Practices Act both pertain to debt collection practices. The Fair Credit Billing Act provides consumers with certain rights relating to alleged billing errors. The Fair Debt Collect Practices Act prohibits creditors from harassing, intimidating, or using abusive methods to obtain payment. Furthermore, if the consumer states in writing that she does not intend to pay the debt or has retained an attorney to represent her in the matter, the creditor must cease any attempts to collect on the debt. The creditor may only contact the debtor to inform her of any action it intends to take (such as filing a lawsuit to collect on the debt). After-Judgment Remedies Generally speaking, if a debtor fails to pay a debt, the creditor must file a lawsuit against the debtor to obtain payment. Suppose, for instance, that Jeff purchased a big-screen TV from Circuit City and paid for it with his Visa.
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Chapter 18 - Chapter 18 Lesson Chapter 18 Lesson 18 - Legal...

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