CREDIT [Part 1 of 4] Newsgroups: misc.consumers,news.answers Path: trystro!think.com!zaphod.mps.ohio-state.edu!darwin.sura.net!convex!news.oc.com!spssig.spss.com!adams From: adams@spss.com (Steve Adams) Subject: misc.consumers FAQ on credit part 1 of 3 Message-ID: <1992Aug25.130430.12748@spss.com> Followup-To: misc.consumers Sender: news@spss.com (Net News Admin) Supersedes: <1992Jul30.144937.39503@spss.com> Organization: SPSS Inc. References: none Distribution: usa Date: Tue, 25 Aug 1992 13:04:30 GMT Approved: news-answers-request@MIT.Edu Expires: Fri, 9 Oct 1992 13:04:30 GMT Lines: 281 Archive-name: consumer-credit-faq/part1 Last-modified: 21 Aug 1992 Welcome! Many questions are frequently asked on misc.consumers. This FAQ tries to answer questions about one area, namely consumer credit. (Even within that area, there's so much information that the FAQ is specialized in credit cards and credit reports.) I hope others will put together similar lists in other areas. Such lists can be forwarded to me for posting and maintenance. This FAQ (Frequently Asked Questions) list should be a repository of the canonical "best" answers. If you know a better answer or a change that improves an answer, please tell me! (Use email, please. Traffic in this group is high, and I might easily miss a relevant posted article.) Steve Adams, SPSS, Inc., Chicago, IL, USA adams@spss.com Because this FAQ list is quite long, it is divided into three parts. Part 1 (this file) is a table of contents, so that you can see easily whether your question is answered in the other two parts. (If you have last month's version, you may want to look at the diffs rather than reread these three long articles. Look for "misc.consumers FAQ on credit diff" in the Subject lines.) Contents of part 2 (credit cards) ================================= section 1. Credit cards, other cards 101. What kinds of cards are there? 102. What is an affinity card? 103. Is MasterCard better than Visa, or vice versa? What about American Express, Diners Club, etc.? 104. Why does my neighbor's MasterCard or Visa have different rates and fees from mine? 105. What is a secured card? 106. What is a guaranteed card? 107. What is an unsecured card? 108. What is a debit card? 109. How does an ATM card differ from a debit card? 110. Where can I find information about telephone credit cards? section 2. Good deals, bad deals 201. In general, what should I look for in a credit card? 202. Do I want a fixed-rate or floating-rate (variable-rate) card? 203. How do annual fees work? 204. Can I get the annual fee waived at renewal time? 205. What about application fees? 206. What other fees should I be concerned about? 207. Why is a grace period important? 208. Why is a discount better than a rebate? 209. What else should I watch out for in cards with rebates? 210. How do I evaluate a secured card? 211. Shouldn't I get as many cards as I can? 212. Why would I want more than one of the same kind of card? 213. Is a gold card worth the higher annual fee? 214. I was mailed a solicitation for a Visa or MasterCard that accrues frequent-flyer miles on my purchases. Is this a good thing? 215. I belong to the Benevolent Order of Mumble, and they mailed me a credit-card solicitation. It would be a MasterCard with their logo on it. Is this a good deal? 216. My bank offered me a deal if I would agree to set up my checking account for automatic withdrawal on the due date to pay the credit card. Is this a good idea? 217. I got a call (or saw an ad) inviting me to call a 900 number for a "guaranteed" MasterCard or Visa. Is this a good deal? 218. What should I watch out for in a corporate card? 219. I saw an ad for a card I've never heard of. What's the story? 220. I got an application for a card that didn't state interest rate and fees. Is this legal? section 3. Lists of good cards 301. Where are lists of the best cards? 302. I don't want to look up magazines. Isn't there an easier way? 303. I understand why low rates or no annual fees are important. Why would I care about which banks issue the most cards? 304. Okay, I know that First Mumble Bank of Fubar has a card I want to apply for. How do I get in touch? section 4. When you buy with a credit card 401. Is it better to pay by check or by credit card, as a rule? 402. When I make a purchase, can they ask for my address or phone number? 403. If it's against the rules, why do merchants insist on address or phone number? 404. What should I do when asked for personal information I don't want to give? 405. I tried to charge a $10 item but the merchant pointed to a sign "minimum charge $20." Is this valid? 406. Can the merchant charge credit-card users more than cash customers for the same item? 407. I made a hotel reservation, and guaranteed it with my credit card. When I showed up, the hotel denied my reservation. Have I any recourse? 408. I paid by check, and the merchant wrote my credit-card number on the back. If the check bounces, can the merchant charge my card? 409. Can mail-order merchants charge my card before they ship? 410. Is there any official document that I can take with me to show merchants who violate the rules? 411. Where should I report merchants who break the rules? 412. Does my payment have to reach the lender by the "due date" on the bill, or is it enough if I just mail it by the due date? 413. I have a checking or savings account at the same bank as my Visa or MasterCard. Can the bank freeze my account or take money from it if I miss a payment on my credit card bill? section 5. Billing errors and overcharges 501. What kind of problems am I protected against? 502. There's an error on my bill. What should I do? 503. I got ripped off by the merchant. What should I do? 504. Exactly which purchases qualify under the Fair Credit Billing Act? 505. Will the bank get involved right away? 506. What does resolving a problem "in good faith" mean? 507. Any other hints for dealing with a problem merchant? 508. I tried in good faith, but the merchant won't budge. Can the bank help? 509. What does the bank do when I ask for a chargeback? 510. What happens to finance charges on the disputed amount? 511. What if I paid my bill in full before I noticed a problem? 512. How do I avoid problems with unauthorized charges? section 6. Miscellaneous credit-card stuff 601. What do the digits in my credit-card number mean? 602. I lost my credit card, or it was stolen. What should I do? 603. What is the 800 number for customer service? 604. Why was I turned down for a credit card? 605. Should I give my credit-card number over the phone? 606. How far can collection agencies go in bothering me? Contents of part 3 (credit reports) =================================== section 7. Credit reports--in general 701. What is "the credit bureau"? 702. Who assigns my credit rating? 703. How long does it take for an event (positive or negative) to show up on my credit report? 704. How does a lender decide whether to grant a loan? 705. Should I apply for as many credit cards and charge accounts as possible, even if I won't use most of them right away? 706. I was refused a loan or credit card. What can I do? 707. One lender refused my loan, but another one said it was fine. How can this be? 708. I'm planning to apply for a loan, and I'd like to know up front that my credit is clean. Can I get a copy? 709. How long do negative items stay in my report? section 8. Getting and reading your credit report 801. How much does my credit report cost? 802. Can I get a free copy of my own credit report? 803. Can I phone in my request? 804. Where do I mail my request for a credit report? 805. What information should I provide when requesting a report? 806. Help! What are all those codes on my credit report? 807. What are "inquiries" on my credit report? section 9. Fixing your credit report 901. I've got a copy of my credit report, and it's wrong. What now? 902. What exactly will the credit bureau do with my correction? 903. My credit report shows adverse information, but I have a letter from the bank saying that information is false. Can I submit this letter to the credit bureau? 904. The credit bureau ignored my correction -- or it says an item is right but I can prove it's wrong. What can I do? 905. My credit report shows transactions from other people with the same name or similar names. How can I get it cleaned up? 906. My spouse and I had joint credit accounts, and s/he ran up a lot of debts. Now we're divorced, and I want my ex's debts off my report. 907. I got in trouble and ran up a lot of debts I couldn't pay, and now my credit report looks awful. How can I get credit? 908. Are "credit repair" agencies legitimate? Disclaimers =========== The information presented here comes from others' research and from seemingly well-informed articles in news media and on Usenet. What is here is true to the best of my understanding, but I am only human (and I'm not an attorney). Before you rely on any of the information here, check it out for yourself. This is only a guide. This list relates to law and custom in the U.S. and should not be taken as a guide to consumer credit in other nations. Also, it concentrates on Federal law as opposed to state laws, which vary widely. State law may give you important protections in addition to those from Federal law, but in every state you have _at_least_ the protections derived from Federal law and listed here. I'm always interested in state and local comparisons, but by design I omit almost all state information from this list: it's long enough already! Other resources =============== The Federal Reserve System publishes a series of pamphlets that describe your legal rights and advise you on conducting your financial affairs. Most are free or cost well under $1. You can get a free index of them from your nearest Federal Reserve Bank; ask for the catalog {Public Information Materials}. (If you don't know where the nearest Federal Reserve Bank is, any bank can tell you.) Readers of this FAQ list will be especially interested in the publications listed on six pages under "Consumer Finance," most intended for the general public. There are also many publications on home-equity loans and other home mortgages. The Federal Financial Institutions Examination Council puts out a booklet called {Consumer Rights}. It lists the Federal laws that protect consumers' rights and explains how to make complaints against financial institutions. I picked up a copy in the literature rack at the FRB of Cleveland; you might try writing the Council at 1776 G Street NW, suite 850B, Washington DC 20006 or ask at your library. General net usage ================= Many FAQs on most newsgroups are really about how to use the net, your newsreader, or email, or what is proper netiquette. If you don't know about that stuff, you are strongly urged to subscribe to either news.newusers.questions or news.announce.newusers, or both. You may also be interested in news.answers, which collects FAQ lists for many newsgroups. That newsgroup should have a long expiry time at your site; if not, talk to your sysadmin. FAQ lists are also available by anonymous FTP or email from pit-manager.mit.edu; see details below. Acknowledgements ================ I want to thank the many misc.consumers readers who've sent corrections and suggestions since the first edition of this list in summer of 1991. I regret that I cannot thank most of them by name, because I failed to keep track of correspondents' names and addresses for the first six or seven months. The following have contributed after 25 Dec 1991: Muhammad Basit, Bill Branum, Craig Browning, Jim Burke, Dale Finn, David Grabiner, Joe Konstan, Tim Lee, John Levine, Roger Lustig, Will Martin, Dave Niebuhr, Rich Salz, Mark Schuldenfrei, Russell Schulz, Carol Springs, William December Starr, Ivan Weisz, David Whiteman, Tom Wicklund, Hongfei Zhang Special thanks goes to Stan Brown, who originated this FAQ. ------------------------------ For updated copies of the complete misc.consumers FAQ on credit, please look first in news.answers for articles with subject lines like this article's. New versions are posted around the third week of each month, in such a way that they should not expire until the following month's version is posted. If you can't find the current edition in news.answers, use ftp to pit-manager.mit.edu [18.172.1.27] to retrieve these files: /pub/usenet/news.answers/consumer-credit-faq/part1 /pub/usenet/news.answers/consumer-credit-faq/part2 /pub/usenet/news.answers/consumer-credit-faq/part3 If you can't find the FAQs in news.answers and you have no ftp access, send a message with the following text send usenet/news.answers/consumer-credit-faq/part1 send usenet/news.answers/consumer-credit-faq/part2 send usenet/news.answers/consumer-credit-faq/part3 and no subject to mail-server@pit-manager.mit.edu. Add "help" on a separate line for instructions on using the server. (continued in part 2) -- The opinions expressed above are those of the author and not SPSS, Inc. ------------------- adams@spss.com Phone: (312) 329-3522 Steve Adams Fax: (312) 329-3558 -/Vuarnet International/- 617/527.oo91 24oo-16.8k HST/V32bis