The first step in preparing a strong consumer credit case is to hire an experienced financial attorney. An attorney will be familiar with all aspects of consumer credit cases as well as other types of financial laws, in the event they apply to the case.

There are several different types of consumer credit an individual may use to meet their financial needs. The most common are:

    • Credit cards, which allow an individual to pay for their expenditures over an indefinite period of time, but they usually have very high interest rates;

 

    • Charge cards, which are similar to credit cards except with no credit limit. An individual must pay the full balance at the end of each month; and

 

    • Debit cards, in which the amount charged is immediately withdrawn from the individual’s bank account. These cards may be used in most places that accept credit cards.

 

In some cases, an individual will apply for a credit card but the application will be rejected if they do not have good credit. In most cases, applications are rejected for one of the following reasons:

  • The balance to credit limit ratio is too high;
  • The amounts owed on accounts are too high;
  • There were too many recent credit inquiries in past year;
  • The level of delinquency on accounts and/or late payments; and
  • There are too many closed credit accounts.

Credit bureaus keep records of an individual’s credit. They are compiled into credit reports and distributed to lenders. Lenders use credit reports to determine whether or not to provide an individual with a credit line. 

An individual can request a copy of their credit report from the three main credit reporting agencies. These are:

  • Equifax;
  • Experian; and
  • TransUnion.

An individual may also receive one free credit report per year showing information from all three reporting companies. It is extremely important for an individual to check their credit at least once a year to ensure there are no inaccuracies and/or indications of identity theft. 

Improving a credit score is an extremely important task for any individual. It will provide them with more credit possibilities as well as better loan rates. It is important to remember that this takes time and requires patience. There are several steps an individual can take to improve their credit, including:

    • Checking their credit report for errors. Should there be any errors, contact the credit bureau and request a correction; 

 

    • Informing the credit bureaus of good behavior. If an individual’s credit report does not show accounts that are paid in a timely manner, they can send the credit bureau a copy of those account statements;

 

    • Continuing to use the credit cards. If an individual uses credit cards and pays on time, it will demonstrate financial responsibility; 

 

    • Setting up payment reminders. Automatic payments will assist in ensuring payments are made on time, which is an important factor in a credit score; 

 

    • Decreasing the amount of debt an individual owes. Reducing credit card debt will slowly increase an individual’s credit score. 

 

Even if an individual attempts to improve their credit and follows the steps above, they may still find themselves involved in a consumer credit case. A lawyer is a great asset in any consumer credit case. 

What Type of Documents and Questions Should I Prepare Before I Meet with My Consumer Credit Lawyer?

It is important to gather any relevant documents prior to a consultation with an attorney. Important documents will likely include:

  • Any documentation related to a credit application;
  • Any documentation related to a debt;
  • Any correspondence with a credit company and/or debt collector; and
  • Any other documents requested by the attorney.

It is also important to prepare a list of questions prior to meeting with the attorney. This will help make the most of the consultation time, which is usually around an hour.

What Makes a Strong or Weak Consumer Credit Case?

There are several laws that apply to consumer credit issues. If an individual can show these laws were violated, they may have a strong consumer credit case. 

The Equal Credit Opportunity Act (ECOA) provides every consumer with an equal chance to obtain credit. It does not mean every consumer is entitled to credit, but that every application will be viewed in the same light. A creditor cannot inquire about an individual’s:

  • Race;
  • Sex;
  • National origin;
  • Religion;
  • Marital status; and/or
  • Child custody status.

The creditor may ask for an individual to voluntarily provide this information, but it should not affect their credit application. A creditor is required to notify an applicant within 30 days whether their application was approved or denied. If it was denied, an individual may ask the reason and the creditor must provide the answer within 60 days. If an individual was approved, but on less favorable terms than they applied, they are also entitled to an explanation.

The Fair Credit Reporting Act (FCRA) governs how an individual’s credit information is collected and shared with third parties. Pursuant to the FCRA, any inaccurate information on a report that is brought to the attention of the credit bureaus and confirmed, must be corrected.

The Fair Debt Collection Practices Act (FDCPA) governs how debt collectors may go about collecting personal debts. It prohibits practices by debt collectors such as:

  • Calling before 8 a.m. or after 9 p.m. in the debtor’s time zone;
  • Calling the debtor at their place of work;
  • Harassing the debtor;
  • Using abusive language;
  • Making false and/or misleading statements;
  • Adding unauthorized charges to the debt; and/or
  • Making threats towards the debtor.

The Truth in Lending Act (TILA) provides guidelines for companies offering credit lines to consumers. Pursuant to the TILA, a lender must disclose:

  • The annual percentage rate;
  • Any applicable finance charges, including: 
    • application fees; 
    • late fees; and 
    • prepayment penalties;
  • The amount financed; and 
  • The payment schedule.

It may seem like the laws regarding consumer credit are overwhelming, but an individual must be aware of their rights in order to know if they have potentially been violated. If an individual believes any of the above laws have been violated, they should keep documentation of the issue.

It will be difficult to make a strong consumer credit case if an individual does not keep any records regarding their consumer debts. Showing that the consumer’s rights were violated will likely require evidence, such as documentation and/or correspondence from credit companies and/or debt collectors. 

What are Some Dos and Don’ts in Consumer Credit Cases?

Some “do’s” for a consumer credit case include: 

    • Do: Be aware of your rights. As noted above, it is difficult to know if your rights have been violated if you do not know what they are.

 

    • Do: Seek an attorney’s help as soon as possible. The sooner you seek help, the sooner the issue can be resolved. 

 

    • Do: Keep detailed records. Keep records of any and all interactions with a credit bureau and/or debt collector. This includes actual paper documents as well as noting phone interactions, including dates and times. 

 

Some “don’ts” for a consumer credit case include:

    • Don’t: Tell a lie. Do not mislead your attorney or any other individual in an attempt to evade a debt payment. This could cause further legal problems.

 

    • Don’t: Get angry and/or threaten a debt collector and/or a credit company. Calmly make the requests you are legally entitled to and if those are denied, seek the assistance of an attorney. 

 

    • Don’t: Get discouraged. As noted above, companies may have as long as 30 or 60 days to respond to a request. In many cases, cleaning up a credit issue takes time. 

 

When Do I Absolutely Need a Consumer Credit  Attorney?

You absolutely need a consumer credit attorney for any consumer credit case. The companies involved are professionals and some even have attorneys on staff. The processes involved can often be complex and overwhelming.

A credit lawyer can help you sort out your financial problems. They may also offer solutions, including negotiating with your creditors, dealing with debt collectors, and/or filing for bankruptcy. An attorney will be familiar with your state’s laws concerning consumer credit. They will fight to protect your interests as well as represent you during any court proceedings, if needed.