Know Your Rights as a Consumer
U.S. law gives consumers more protection than many people realize. Knowing the basics helps you notice when something is not right, and what to ask for.
Key takeaways
- You can see what is in your credit reports and dispute information that is inaccurate or incomplete.
- Credit card billing errors can be disputed in writing within 60 days after the statement showing the error was sent.
- Third-party debt collectors must tell you about the debt and may not harass, threaten or deceive you.
- Federal rules also cover late shipments, some in-home sales and telemarketing calls, and your state may add more.
This guide is a general overview of several important federal consumer protections. It is not a complete list, and the details can depend on your situation and on your state, which often adds protections of its own. Use it to recognize your rights and to know which questions to ask.
Your credit reports
The Fair Credit Reporting Act governs how consumer reporting agencies collect and share information about you. Among other things, it gives you the right to:
- See the information in your credit reports. Free reports from Equifax, Experian and TransUnion are available through AnnualCreditReport.com, the official source.
- Dispute information that is inaccurate or incomplete. The credit bureau generally must investigate, usually within 30 days, and correct or delete information that cannot be verified.
- Be told when information in your report has been used against you, for example to deny you credit, insurance or a job, and to get a free copy of that report.
- Limit who sees your report. A business generally needs a permissible purpose, and an employer needs your written permission.
When disputing, write to the credit bureau and to the company that supplied the information. Explain what is wrong, include copies (never originals) of supporting documents, and keep a record of what you sent.
Credit card billing errors
The Fair Credit Billing Act lets you dispute billing errors on credit cards and other revolving accounts. Billing errors include charges you did not make, charges for the wrong amount, and charges for goods or services you did not accept or that were not delivered as agreed. Send a written dispute to the address your issuer lists for billing errors so that it reaches the issuer within 60 days after the statement containing the error was sent to you.
While the dispute is investigated, you may withhold payment on the disputed amount, though you still need to pay the rest of your bill. Separately, federal law limits your liability for unauthorized use of your credit card to $50.
Debit cards and electronic transfers
The Electronic Fund Transfer Act covers debit cards, ATM withdrawals, direct deposits and other electronic transfers. If your debit card is lost or stolen, or you see a transfer you did not authorize, report it to your bank as quickly as possible. Your potential liability grows the longer you wait, so check your account activity regularly. You also have the right to ask your bank to investigate errors on your statement.
Clear terms before you borrow
The Truth in Lending Act requires lenders to disclose key credit terms in a standard way, including the annual percentage rate (APR), the finance charge and the total of payments. Standard disclosures make offers easier to compare. For certain loans secured by your home, such as many refinances and home equity loans, you also have a right to cancel within three business days.
Dealing with debt collectors
The Fair Debt Collection Practices Act applies to third-party debt collectors, meaning companies collecting debts on behalf of someone else. They may not harass you, use threats or abusive language, misrepresent the amount you owe, or pretend to be attorneys or government officials. They generally may not call before 8 a.m. or after 9 p.m. your local time, or contact you at work if they know your employer does not allow it.
A collector must tell you about the debt, including the amount and the creditor, and explain how to dispute it. If you dispute the debt in writing within the validation period, generally 30 days, the collector must pause collection until it provides verification. You can also ask a collector in writing to stop contacting you. That does not erase a valid debt, but it limits further contact.
Buying at home, by mail and online
The Cooling-Off Rule
The FTC’s Cooling-Off Rule gives you until midnight of the third business day to cancel certain sales made at your home or at a seller’s temporary location, such as a hotel room or convention center. It generally covers sales of $25 or more at your home and $130 or more at temporary locations. Some sales are excluded, and the rule does not cover online purchases.
Shipping on time
The FTC’s Mail, Internet, or Telephone Order Merchandise Rule requires sellers to ship within the time they state, or within 30 days if they state no time. If a seller cannot ship on time, it must tell you and give you the option to cancel for a full refund.
Unordered merchandise
If a company mails you merchandise you never ordered, federal law generally lets you keep it without paying for it.
Unwanted telemarketing calls
You can add your phone numbers to the National Do Not Call Registry for free, and legitimate telemarketers must stop calling within 31 days. The registry does not cover every call; political groups, charities and surveys are among those exempt. Scammers ignore the registry entirely, so a sales call after you have registered is itself a warning sign.
Where to turn when something goes wrong
Start with the business itself and keep a written record. If that does not resolve it, you can submit a complaint about financial products, such as credit cards, bank accounts, loans and credit reports, to the Consumer Financial Protection Bureau. Report fraud and unfair business practices to the Federal Trade Commission, and contact your state attorney general’s office about local businesses. For complex or high-stakes situations, a licensed attorney or a legal aid organization can advise you on your specific circumstances.
Helpful official resources
These official sites are the best places to confirm current rules and to report problems. IntelliReply is not affiliated with any of them.
- Consumer Financial Protection Bureauconsumerfinance.gov
- Federal Trade Commission: Consumer Adviceconsumer.ftc.gov
- AnnualCreditReport.comannualcreditreport.com
- USA.govusa.gov
This guide is general educational information, not legal or financial advice. Rules can change and may differ by state, so check the official sources above for the latest details. Spotted something that needs correcting? Let us know.
