Definitive Guide to a Debt Free Life – Chapter 11: Laws, Amendments, & Acts Related to Debt

There are a number of laws, amendments, and acts that are related to debt.

When you are struggling with debt and seeking debt relief, it is important to be fully aware of these. This chapter outlines these different laws and explains why they are so important to you.

The information about these laws, amendments, and acts will help you get out of debt quickly and more efficiently and make the right decisions while doing so. They will also protect you from frauds, scams, and plain old errors.

Consumer Credit Protection Act

Acting as the backbone for most other laws, amendments, and acts related to debt, the Consumer Credit Protection Act likely importantly applies to you.

The act, often abbreviated to CCPA, was first put into effect in 1968. The law was established to help protect American citizens by guaranteeing them fair and honest credit practices.

Simply put, the Consumer Credit Protection Act requires lenders nationwide to follow the same rules and regulations. Over time as banking and credit reporting has transformed and evolved, the CCPA itself has transformed and evolved alongside it, ensuring that it is up to date and relevant in today’s day and age.

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Currently, the CCPA contains several sub-laws that help govern many different areas of credit and finance. Though the specifics of each of these laws are different, they are all meant to protect you – the consumer.

In fact, the Consumer Credit Protection Act can be thought of as the overarching law for the other three debt-related acts discussed below. (

Fair Debt Collection Practices Act

Another important law for those struggling with debt – or, anyone, really – to understand is the Fair Debt Collection Practices Act.

The FDCPA, as it is often referred to as, was enacted in 1977. It sets down a list of rules and regulations regarding the way that debt collectors and creditors have to treat you. The law is concerned with your protection from these collectors.

The Fair Debt Collection Practices Act is particularly concerned with preventing unfair practices such as false statement and harassment. It also lists hours in which debt collectors can and cannot contact you during, 8:00 a.m. to 9:00 p.m. being the hours that they can.

Furthermore, the act ensures that debt collectors identify themselves as such over the phone and explain the basis for their phone calls.

If you are struggling with debt, especially if a creditor has passed the debt on to a collector, it is of utmost importance that you understand the Fair Debt Collection Practices Act. ( 

Fair Credit Reporting Act

The Fair Credit Reporting Act is another law that is important for those struggling with debt to keep in mind.

A very important law for nearly all Americans, the FCRA regulates the ways in which private business can use your personal information.

The act works as a safeguard for your credit. It requires businesses along with consumer reporting agencies to stick to certain practices and follow specific standards. It sets rules in place which protect you from credit theft and ensure accurate reporting.

The Fair Credit Reporting Act is what gives you the right to a free annual credit report. Furthermore, it ensures that your access to this report is protected and that the information displayed on it is accurate. The FCRA also requires inaccuracies and errors to be fixed in as efficient a manner as possible along with giving you the right to sue and seek damages from businesses that violated your rights.

The Credit CARD ACT, the Dodd-Frank Act, and the Fair and Accurate Credit Transactions Act are all sub-acts that fall under the Fair Credit Reporting Act umbrella. These acts pertain to the accountability of credit card companies in instances of fraud and identity theft. ( 

Electronic Fund Transfer Act

The last important law, amendment, and act related to debt that we will discuss in this chapter is the Electronic Fund Transfer Act.

Also known as the EFTA, the act was originally established in 1978. It was created to protect your money during electronic funds transfers. It concerns several actions including ATM transactions, swiping your debt card at a POS (point-of-sale) terminal, and completing bill payments online or over the telephone.

It is of utmost importance to note that the Electronic Fund Transfer Act only protects transactions that result in the immediate withdrawal of funds from your specified account.

The idea behind the Electronic Fund Transfer Act is to protect you from fraud. It helps limit your personal liability in the instance that your credit or debit card is lost or stolen.

The EFTA also makes it mandatory for companies to fully disclose all of the information concerning their fees and liability regulations before they issue you a new credit card.

Finally, it gives you the right to choose your own method of payment. This can be an electronic fund transfer or otherwise.

The Electronic Fund Transfer Act covers a lot of ground. It is very important for everyone to understand, especially those that are in debt. (

Though they are not the most exciting of topics, the many laws, amendments, and acts that are related to debt are very important to understand. Having a basic knowledge of them will help your protect your rights, especially your financial and credit rights, and keep you safe.

The four acts discussed above are only the tip of the iceberg as far as debt-related laws, amendments, and acts go. However, they are the most important ones that you need to understand when you are in debt.

Stay tuned for Chapter 12 of this guidebook. In it, we discuss the dangers of student loans. Though such loans can be an essential and effective way to pay for a college education, they definitely have their drawbacks. These drawbacks among much else will be discussed in Chapter 12. 


  •, “Fair Credit Reporting Act”
  •, “FDIC Law, Regulations, Related Acts”

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