Credit Protection

Common Language Key to Understanding Credit Cards

The credit protection laws officially fell under the "Consumer Credit Protection Act of 1968." One of the Act's main goals was to ensure that credit companies provided information to their customers (e.g. the credit card holders) in a language that was non-technical and easily understandable.

Since 1968, there have been many additional types of credit protection laws enacted to ensure credit card holders are not left at the mercy of credit card companies when problems or disputes arise.

Credit Law Examples

Some of the laws that are in place to protect credit card customers from discrimination include:

• Credit card companies are not legally allowed to deny offering a line of credit to a woman simply because she is unmarried.
• If something appears on a credit card statement that is incorrect, the credit card owner can dispute it without fear that the error or dispute will immediately be reported to a credit scoring agency.
• A credit card company cannot take a line of credit away simply because a person has reached a certain age.

This is just a sample of the credit related laws that exist to help ensure that nobody is denied credit based solely on race, creed, religion, gender, age, etc.

Credit and Identity Theft

There are several laws regarding punishment for anyone who either steals or attempts to steal another person's identity for the purpose of opening a credit card account in that person's name, accessing another person's bank accounts, or even committing a crime while posing as another person.

Unfortunately, there is no guaranteed that guards your credit against identity theft. Because those who steal identities do so in such secretive ways, it's sometimes difficult to discover that it has happened. One of the most effective ways to monitor the situation is for a person to regularly review his credit report to make sure that all transaction reported look legitimate. While identity theft can be discovered by reviewing a credit report, it can still be difficult to fix - let alone prove.

Is Credit Protection Insurance Worth the Cost?

Many people are worried about the potential of becoming a victim of identity theft and wonder if credit protection insurance might help them. Many experts agree that credit protection insurance is not worth the money.

First of all, if any unauthorized person uses another person's credit card, the credit card holder is only liable for a maximum of $50 of what was unlawfully charged to the card. Second, this insurance is expensive, and it only covers a limited number of issues that can be easily prevented or monitored by the credit card holder. Carefully checking monthly credit card statements and free copies of credit reports can help a person be their own best source of protection.