The federal fair credit
billing act (FCBA) covers open credit contracts and credit card plans and your
rights when your are billed incorrectly.
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corrected, false, falsely, accurate, inaccurate, mistake, mistakes credit card,
debts, charge cards, open end consumer credit creditor wrong
The fair credit card billing act (fcba) allows you to withhold
payments on defective goods until creditors correct billing errors or replaces
or repairs defective goods! Learn more...
The federal fair credit billing act
This federal credit protection law requires creditors to promptly
correct billing mistakes and it allows you to withhold payments on defective
goods plus it also requires creditors to promptly credit your payments to avoid
late fees.
- Open end consumer credit plans
- Disclosure for credit or charge card
applications and solicitations
- Additional credit and charge card disclosure
information
- Telephone credit solicitations
- Applications and solicitations by other
means
- General information without any specific term
- Charge card applications and solicitations
- Additional Charge Card Applications and
Solicitations Information
- Applications and solicitations by other
means
- Issuers of charge cards and access to open end
credit plans.
- Charge card defined
- Disclosure prior to renewal
- Insurance in connection with certain open end
credit card plans
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1. Open end consumer credit plans
Required disclosures by creditor:
Before opening any account under an open end consumer credit
plan, the creditor shall disclose to the person to whom credit is to be
extended each of the following items, to the extent applicable:
(1) The conditions under which a finance charge may be
imposed, including the time period (if any) within which any credit extended
may be repaid without incurring a finance charge, except that the creditor may,
at his election and without disclosure, impose no such finance charge if
payment is received after the termination of such time period. If no such time
period is provided, the creditor shall disclose such fact.
(2) The method of determining the balance upon which a
finance charge will be imposed.
(3) The method of determining the amount of the finance
charge, including any minimum or fixed amount imposed as a finance charge.
(4) Where one or more periodic rates may be used to compute
the finance charge, each such rate, the range of balances to which it is
applicable, and the corresponding nominal annual percentage rate determined by
multiplying the periodic rate by the number of periods in a year.
(5) Identification of other charges which may be imposed as
part of the plan, and their method of computation, in accordance with
regulations of the Board.
(6) In cases where the credit is or will be secured, a
statement that a security interest has been or will be taken in
(A) the property purchased as part of the credit
transaction, or
(B) property not purchased as part of the credit
transaction identified by item or type.
(7) A statement, in a form prescribed by regulations of the
Board of the protection provided by sections 1666 and 1666i of this title to an
obligor and the creditor's responsibilities under sections 1666a and 1666i of
this title. With respect to one billing cycle per calendar year, at intervals
of not less than six months or more than eighteen months, the creditor shall
transmit such statement to each obligor to whom the creditor is required to
transmit a statement pursuant to subsection (b) of this section for such
billing cycle.
(8) In the case of any account under an open end consumer
credit plan which provides for any extension of credit which is secured by the
consumer's principal dwelling, any information which;
(A) is required to be disclosed under section 1637a(a) of
this title; and
(B) the Board determines is not described in any other
paragraph of this subsection.
(9) Statement required with each billing cycle. The creditor
of any account under an open end consumer credit plan shall transmit to the
obligor, for each billing cycle at the end of which there is an outstanding
balance in that account or with respect to which a finance charge is imposed, a
statement setting forth each of the following items to the extent applicable:
(1) The outstanding balance in the account at the beginning
of the statement period.
(2) The amount and date of each extension of credit during
the period, and a brief identification, on or accompanying the statement of
each extension of credit in a form prescribed by the Board sufficient to enable
the obligor either to identify the transaction or to relate it to copies of
sales vouchers or similar instruments previously furnished, except that a
creditor's failure to disclose such information in accordance with this
paragraph shall not be deemed a failure to comply with this part or this
subchapter if:
(A) the creditor maintains procedures reasonably adapted
to procure and provide such information, and
(B) the creditor responds to and treats any inquiry for
clarification or documentation as a billing error and an erroneously billed
amount under section 1666 of this title.
In lieu of complying with the requirements of the
previous sentence, in the case of any transaction in which the creditor and
seller are the same person, as defined by the Board, and such person's open end
credit plan has fewer than 15,000 accounts, the creditor may elect to provide
only the amount and date of each extension of credit during the period and the
seller's name and location where the transaction took place if :
(A) a brief identification of the transaction has been
previously furnished, and
(B) the creditor responds to and treats any inquiry for
clarification or documentation as a billing error and an erroneously billed
amount under section 1666 of this title.
(3) The total amount credited to the account during the
period.
(4) The amount of any finance charge added to the account
during the period, itemized to show the amounts, if any, due to the application
of percentage rates and the amount, if any, imposed as a minimum or fixed
charge.
(5) Where one or more periodic rates may be used to compute
the finance charge, each such rate, the range of balances to which it is
applicable, and, unless the annual percentage rate (determined under section
1606(a)(2) of this title) is required to be disclosed pursuant to paragraph
(6), the corresponding nominal annual percentage rate determined by multiplying
the periodic rate by the number of periods in a year.
(6) Where the total finance charge exceeds 50 cents for a
monthly or longer billing cycle, or the pro rata part of 50 cents for a billing
cycle shorter than monthly, the total finance charge expressed as an annual
percentage rate (determined under section 1606(a)(2) of this title), except
that if the finance charge is the sum of two or more products of a rate times a
portion of the balance, the creditor may, in lieu of disclosing a single rate
for the total charge, disclose each such rate expressed as an annual percentage
rate, and the part of the balance to which it is applicable.
(7) The balance on which the finance charge was computed and
a statement of how the balance was determined. If the balance is determined
without first deducting all credits during the period, that fact and the amount
of such payments shall also be disclosed.
(8) The outstanding balance in the account at the end of the
period.
(9) The date by which or the period (if any) within which,
payment must be made to avoid additional finance charges, except that the
creditor may, at his election and without disclosure, impose no such additional
finance charge if payment is received after such date or the termination of
such period.
(10) The address to be used by the creditor for the purpose
of receiving billing inquiries from the obligor.
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2. Disclosure in credit and charge card applications
and solicitations (direct mail applications and solicitations)
Any application to open a credit card account for any person
under an open end consumer credit plan, or a solicitation to open such an
account without requiring an application, that is mailed to consumers shall
disclose the following information, subject to subsection (e) of this section
and section 1632(c) of this title:
Annual percentage rates
Each annual percentage rate applicable to extensions of
credit under such credit plan.
Where an extension of credit is subject to a variable rate,
the fact that the rate is variable, the annual percentage rate in effect at the
time of the mailing, and how the rate is determined.
Where more than one rate applies, the range of balances to
which each rate applies.
Annual and other fees
Any annual fee, other periodic fee, or membership fee imposed
for the issuance or availability of a credit card, including any account
maintenance fee or other charge imposed based on activity or inactivity for the
account during the billing cycle.
Any minimum finance charge imposed for each period during
which any extension of credit which is subject to a finance charge is
outstanding.
Any transaction charge imposed in connection with use of the
card to purchase goods or services.
Grace period:
The date by which or the period within which any credit
extended under such credit plan for purchases of goods or services must be
repaid to avoid incurring a finance charge, and, if no such period is offered,
such fact shall be clearly stated.
If the length of such ''grace period'' varies, the card
issuer may disclose the range of days in the grace period, the minimum number
of days in the grace period, or the average number of days in the grace period,
if the disclosure is identified as such.
Balance calculation method
The name of the balance calculation method used in
determining the balance on which the finance charge is computed if the method
used has been defined by the Board, or a detailed explanation of the balance
calculation method used if the method has not been so defined.
In prescribing regulations to carry out this clause, the
Board shall define and name not more than the 5 balance calculation methods
determined by the Board to be the most commonly used methods.
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3. Other Credit and Charge Card Disclosure Information
In addition to the information required to be disclosed under
subparagraph (A), each application or solicitation to which such subparagraph
applies shall disclose clearly and conspicuously the following information,
subject to subsections (e) and (f) of this section:
Cash advance fee
Any fee imposed for an extension of credit in the form of
cash.
Any fee imposed for a late payment.
Over-the-limit fee
Any fee imposed in connection with an extension of credit in
excess of the amount of credit authorized to be extended with respect to such
account.
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4. Telephone solicitations
In general any telephone solicitation to open a credit card
account for any person under an open end consumer credit plan, the person
making the solicitation shall orally disclose the information described in this
Act as required except telephone solicitations shall not be required to orally
disclose information described in this Act if the credit card issuer:
Does not impose any fee;
Does not impose any fee in connection with telephone
solicitations unless the consumer signifies acceptance by using the card;
The card issuer discloses clearly and conspicuously in
writing the information described in paragraph (1) within 30 days after the
consumer requests the card, but in no event later than the date of delivery of
the card; and
The card issuer discloses clearly and conspicuously that the
consumer is not obligated to accept the card or account and the consumer will
not be obligated to pay any of the fees or charges disclosed unless the
consumer elects to accept the card or account by using the card.
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5. Applications and solicitations by other
means
In general
Any application to open a credit card account for any person
under an open end consumer credit plan, and any solicitation to open such an
account without requiring an application, that is made available to the public
or contained in catalogs, magazines, or other publications shall meet the
disclosure requirements of this Act.
Specific information
An application or solicitation described in above meets the
requirement of this subparagraph if such application or solicitation contains -
the information - described in herein, in the form required
under section 1632(c) of this title, subject to subsection (e) and described in
a clear and conspicuous form, subject to subsections (e) and (f) of this
section;
A statement, in a conspicuous and prominent location on the
application or solicitation, that -
the information is accurate as of the date the application
or solicitation was printed;
the information contained in the application or
solicitation is subject to change after such date; and
the applicant should contact the creditor for information
on any change in the information contained in the application or solicitation
since it was printed; a clear and conspicuous disclosure of the date the
application or solicitation was printed; and a disclosure, in a conspicuous and
prominent location on the application or solicitation, of a toll free telephone
number or a mailing address at which the applicant may contact the creditor to
obtain any change in the information provided in the application or
solicitation since it was printed.
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6. General information without any specific
term
An application or solicitation described in subparagraph above
meets the requirement of this subparagraph if such application or solicitation
contains a statement, in a conspicuous and prominent location on the
application or solicitation, that:
there are costs associated with the use of credit
cards; and the applicant may contact the creditor to request disclosure of
specific information of such costs by calling a toll free telephone number or
by writing to an address, specified in the application;
contains a disclosure, in a conspicuous and prominent
location on the application or solicitation, of a toll free telephone number
and a mailing address at which the applicant may contact the creditor to obtain
such information;
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7. Charge card applications and solicitations
(A) In general
Any application or solicitation to open a charge card account
shall disclose clearly and conspicuously the following information in the form
required by section 1632(c) of this title, subject to subsection (e) of this
section:
Any annual fee, other periodic fee, or
membership fee imposed for the issuance or availability of the charge card,
including any account maintenance fee or other charge imposed based on activity
or inactivity for the account during the billing cycle.
Any transaction charge imposed in connection
with use of the card to purchase goods or services. (
A statement that charges incurred by use of
the charge card are due and payable upon receipt of a periodic statement
rendered for such charge card account.
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8. Additional Charge Card Applications and
Solicitations Information
In addition to the information required to be disclosed
under subparagraph (A), each written application or solicitation to which such
subparagraph applies shall disclose clearly and conspicuously the following
information, subject to subsections
Cash advance fee
Any fee imposed for an extension of credit in the form of
cash.
Late fee
Any fee imposed for a late payment.
Over-the-limit fee
Any fee imposed in connection with an extension of credit
in excess of the amount of credit authorized to be extended with respect to
such account.
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9. Applications and solicitations by other
means
Any application to open a charge card account, and any
solicitation to open such an account without requiring an application, that is
made available to the public or contained in catalogs, magazines, or other
publications shall contain -
the information - described in subparagraph (A) in the form
required under section 1632(c) of this title, subject to subsection (e) of this
section, and (II) described in subparagraph (B) in a clear and conspicuous
form, subject to subsections (e) and (f) of this section;
a statement, in a conspicuous and prominent location on the
application or solicitation, that -
the information is accurate as of the date the application or
solicitation was printed;
the information contained in the application or solicitation
is subject to change after such date; and
the applicant should contact the creditor for information on
any change in the information contained in the application or solicitation
since it was printed;
a clear and conspicuous disclosure of the date the
application or solicitation was printed; and
a disclosure, in a conspicuous and prominent location on the
application or solicitation, of a toll free telephone number or a mailing
address at which the applicant may contact the creditor to obtain any change in
the information provided in the application or solicitation since it was
printed.
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10. Issuers of charge cards which provide access to
open end consumer credit plans.
If a charge card permits the card holder to receive an
extension of credit under an open end consumer credit plan, which is not
maintained by the charge card issuer, the charge card issuer may provide the
information described in subparagraphs (A) and (B) in the form required by such
subparagraphs in lieu of the information required to be provided under
paragraph (1), (2), or (3) with respect to any credit extended under such plan,
if the charge card issuer discloses clearly and conspicuously to the consumer
in the application or solicitation that -
the charge card issuer will make an independent decision as
to whether to issue the card;
the charge card may arrive before the decision is made with
respect to an extension of credit under an open end consumer credit plan; and
approval by the charge card issuer does not constitute
approval by the issuer of the extension of credit.
The information required to be disclosed under paragraph (1)
shall be provided to the charge card holder by the creditor which maintains
such open end consumer credit plan before the first extension of credit under
such plan.
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11. Charge card defined
For the purposes of this subsection, the term ''charge card''
means a card, plate, or other single credit device that may be used from time
to time to obtain credit which is not subject to a finance charge.
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12. Disclosure prior to renewal
In general
A card issuer that imposes any fee shall transmit to a consumer
at least 30 days prior to the scheduled renewal date of the consumer's credit
or charge card account a clear and conspicuous disclosure of -
the date by which, the month by which, or the billing period
at the close of which, the account will expire if not renewed;
the method by which the consumer may terminate continued
credit availability under the account.
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13. Insurance in connection with certain open end
credit card plans
Change in insurance carrier
Whenever a card issuer that offers any guarantee or insurance
for repayment of all or part of the outstanding balance of an open end credit
card plan proposes to change the person providing that guarantee or insurance,
the card issuer shall send each insured consumer written notice of the proposed
change not less than 30 days prior to the change, including notice of any
increase in the rate or substantial decrease in coverage or service which will
result from such change. Such notice may be included on or with the monthly
statement provided to the consumer prior to the month in which the proposed
change would take effect.
Notice of new insurance coverage in any case in which a
proposed change occurs
the insured consumer shall be given the name and address of
the new guarantor or insurer and a copy of the policy or group certificate
containing the basic terms and conditions, including the premium rate to be
charged.
Right to discontinue guarantee or insurance
The notices required under paragraphs (1) and (2) shall each
include a statement that the consumer has the option to discontinue the
insurance or guarantee.
No preemption of State law
No provision of this subsection shall be construed as
superseding any provision of State law which is applicable to the regulation of
insurance.
Board definition of substantial decrease in coverage or service
The Board shall define, in regulations, what constitutes a
''substantial decrease in coverage or service'' for purposes of paragraph
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