YOUR RIGHTS AS A CONSUMER

Your Rights as a Consumer
    You are a consumer when you buy goods or service, or enter into rental mortgage, loan or installment transactions, for personal, family, or household use.  This pamphlet explains some of your rights as a consumer.

Getting Credit
    If you are 18 years old or older, you cannot be refused credit because of sex, marital status, mental retardation, age, blindness, learning disability, race, color, religion, creed, national origin, ancestry, physical disability, source of income or sexual orientation.   If you are denied credit, must be told why within 30 days.
    If the denial was based on a credit bureau report, you should ask the credit bureau what is in that report.  If the information is wrong, you can ask the credit bureau to investigate and correct its files.  You also can put your own short explanation into the credit bureau's files.
    Married women can have credit and credit records in their own names, separate from their spouses.  A creditor cannot require your spouse to co-sign with you as a condition of your receiving credit.

The Cost of Credit
    Many lenders and sellers are limited in the interest they may charge. Interest rates limits vary in different transactions.  For instance, the general interest rate is 12% but more interest can be charged by banks and credit unions.  Also more interest can be charged for credit cards, small loans and car sales.  Second mortgage lenders and brokers are regulated by a special law limiting the "points" and other closing-related fees they can charge.
   In most cases where interest is included, or where you may pay in five or more installments, the seller or lender must give you enough information to allow you to shop for credit before you enter into an agreement.  For example, the seller or lender must tell you how much the "finance charge" (dollar amount of interest and points) will be and what the "annual percentage rate" will be so that you can compare rates.
    When you make a major purchase, it is wise to shop for credit.  Consider borrowing on the cash value of your life insurance, or get a passbook loan.  Then check the personal loan rates at your credit union or bank.  If you cannot get a loan from any of these places, consider a small loan company or licensed second mortgage lender for credit.

Contracts
   A consumer contract, by law, is supposed to be in plain, understandable language.MAKE SURE ALL PROMISES MADE TO YOU ARE PUT IN WRITING. DO NOT SIGN ANYTHING WITHOUT READING IT.  TAKE YOUR TIME.  IF YOU HAVE ANY QUESTIONS, ASK.
    If you don't want to agree to a certain term ( for instance, default or attorney's fee clause ), cross it out and put your initials next to the part crossed out.  Never sign a contract with blank spaces.  Cross them out.  Always ask for and keep a copy of anything you sign.  Also keep all receipts, warranties, cancelled checks, and other papers.

Sales at Your Home
    You can cancel a magazine sale, or any other sale of goods or services made at your home, within three business days.  The seller is required to give you a notice explaining your cancellation rights.  If you cancel in writing within three business days, all your money must be refunded.
    Home improvement contracts are included in this law about sales at your home.  In addition, home improvement contractors must be licensed by the Consumer Protection Department.

Credit Card Protections
    If you dispute the amount of a monthly statement, notify the creditor in writing of the error, and ask for a correction.  Each creditor is required to tell you in writing what procedures to follow if you question your monthly statement.
    If you bought something with a credit card and have a dispute with the seller about what you bought, you may have to pay that part of the bill if you charged more than $50 to buy the item and you bought it in your home state or within 100 miles of your current address.  But first, you must try to resolve your dispute with the seller.
    If your credit card is lost or stolen, you are not liable for unauthorized use once you have notified the card issuer; even if the issuer has not been notified your liability cannot exceed $50.  A bank which has issued a credit card cannot take money out of your bank account to pay the debt, without a court order, or specific authorization.  But the bank can take money out of your account to pay a mortgage or installment loan, if you are behind in your payments.

Warranties On Goods
    Express warranties are statements about the merchandise which caused you to buy.  If these statements are not true, you may cancel the sale ( if the misrepresentations are serious ) and get back money, have the goods repaired or replaced at the seller's cost, or deduct your damages.
   Most consumer goods also are sold with implied warranties concerning the usability of the product.  Connecticut law limits the extent to which a seller can change or remove an implied warranty on a new item.

    There is a federal warranty law, which requires the seller to provide you with certain information about product warranties, and gives you the right to sue for damages and for your attorney's fees and costs.
    Connecticut's "Lemon Laws" protect buyers and lessees of defective new and used cars. Under this law if the dealer cannot fix a defect in a new car covered by the warranty after a reasonable number of attempt during the applicable period of two (2) years or 18,000 miles from date of delivery to the consumer, whichever happens first, (or if the car is in the repair shop for a cumulative total of 30 days during the applicable period for the same defect), you are entitled to a refund or a new car.  For used cars costing $3,000 or more, dealers must provide a warranty that the car is mechanically operational and sound.  Dealers can sell used cars which are priced under $3,000 or are 7 or more years of age "as is" only if they include a specific statement to that effect in large print on the front of the sales contract.  Informal arbitration is available to buyers of a new cars through the Department of Consumer Protection.

Security Interests
    When a seller or lender takes a security interest in your car or furniture, it can repossess the item if you do not pay-and if the repossession is done peacefully.
    Upon repossession of furniture, appliances, or a car that cost you $2,000 or less, the debt is cancelled.  When a car that cost than $2,000 is repossessed, the bank or seller has to give you certain notices. If there is a difference between the debt and statutory value of the car, the reasonable value of the repossessed car has to be proved, and you may have to pay the difference.  It is important to have an attorney represent you if you are sued after repossession, since you have many rights; the creditor might have to pay you and your attorney if the creditor has not complied with applicable laws.

Credit Insurance
    Credit insurance insures the seller or lender and pays them the insurance benefits of a credit life or disability insurance policy in the event of their death or disability.
    Most sellers and lenders tell you in writing that credit insurance is not required; sometimes they try to make you buy it anyway.  Credit insurance is a significant source of profit for a business.  You do not have to sign up for credit insurance; you should always ask for a comparative prices on credit insurance, since the seller may try to sell you a more expensive policy than you need.

Unfair Practices
    You may feel you have been cheated or mislead.  There is a general law covering unfair practices which allows you to sue for damages and get your attorney's fees paid too.  Unfair practices can include such things as misrepresentation, excessive prices, poor quality merchandises or services, high pressure sales tactics, and unfair refund policies.  If you feel that you have such a claim, you can file a compliant with the Department of Consumer Protection or see an attorney.

Debit Collection
    A creditor or collection agency may not use abusive or deceptive tactics to get you to pay a bill.  A collector may not call your neighbors, relatives ( other than your spouse ) or employer about your debts.  The collector may not call at an inconvenient time or place ( at your job ) if you tell him or her that it is inconvenient.  the collector may not contact you at all if you have an attorney, or you tell him or her in writing not to contact you anymore.  If you dispute the debt you should let the collector know right away in writing.

Wage Attachments
    Sometimes a collector will threaten to take your wages.  This cannot be done until you have been sued, and a judgement has entered.  The judgment will order you to make weekly payments.  If you make those payments, your wages cannot be attached.
     Part of your wages cannot be attached at all under Connecticut law; the maximum attachment is 25% of your disposable income.  You can usually reduce an attachment by agreement with the creditors attorney.  Be sure to read the wage attachment form carefully.
     You can not be fired by your employer for wage attachments, unless you have more than seven served in one year.

Bankruptcy
    
If your debts can not be managed and you want a fresh start, you may declare bankruptcy.  any people in Connecticut use "straight bankruptcy" which cancels most debts.  You also might want to consider the "wage earner plan," which lets you pay your debts over a period of time.  A discharge in bankruptcy relieves you of most debt ( but not support debts, or taxes less than three years old).
    Certain assets are exempt, that is, they do not need to be turned over to the bankruptcy court, and you can keep them for your fresh start.  It is important to have a good legal advice before making a decision about bankruptcy.
     Sometimes credit counseling can help you avoid bankruptcy.  Call your local Info-Line for the information on the nearest credit counseling service.

Co-Signers
    When you co-sign fore someone else, you are fully responsible to pay that debt if the person you co-sign for doesn't pay it. Many people think that co-signing is just a favor for a friend, it is not.  It is a commitment to pay the debt in full, so be very careful about co-signing for anyone.

Layaway Plans
   When you buy goods on layaway, the seller must give you a written document describing the goods, the purchase price, and the layaway plan.  The seller cannot later increase the price, substitute different goods, or refuse to deliver any goods which have been fully paid for, even though their are more items still on layaway.
    If the seller does any of these things, you can cancel the transaction and get all your money back.

Repairs
    When you have goods repaired, such as a car, a watch, or a TV, you have a right to get a written estimate of the cost of the repair in advance.  You can't be charged more than the estimate, and you can all the replaced parts back..
    A repairer must have a sign posted on the premises telling you of your rights.  In the case of cars, you don't have to pay more than the repair estimate, unless you agree to do so, and the garage can't refuse to return your car if you paid the estimated price.

Mail and Telephone Order Merchandise
    
If you get something through the mail that you did not order, you do not have to pay for it.  If you order something through the mail or by telephone, the seller generally has to fill your order within 30 days or ask you whether or not you want to cancel the order.  To protect yourself, use a credit card.  Then if the merchandise is not delivered or is defective, you can explain that to the credit card issuer and refuse to pay.  Complaints should be filed with the Federal Trade Commission.

Consumer Protection Laws
    There are more than 50 state and federal laws protecting you as a consumer.  Only a few of them have been mentioned here.  If you have a problem with a consumer transaction, there may well be a law that can help you.
    In addition, there are agencies which enforce consumer laws, such as the Connecticut Banking Department, Consumer Protection Department, and Insurance Department.  You can register your complaint with the Better Business Bureau, or consumer action programs, as well as state licensing agencies.
    You should not hesitate to talk to an attorney about your consumer problem. Many of the laws which protect consumers also provide that the consumers attorney's fees must be paid by the creditor.  An attorney can tell whether it will cost you anything to stand up for your rights as a consumer.

CREDIT REPORTS: 10 years of Financial Information
By Barry L. Thompson of Thompson and Vollono, LLC
update added 11/24/99

  Your credit report or "credit history" covers the last 10 years of your financial life. Credit reports often only take on importance to you when you are seeking to borrow a large sum of money such as a mortgage loan to purchase a home or an automobile loan. If you applied for and received a department store credit card back in 1991, even if you never used it, it will still appear on your credit report. It will continue to appear on the reports for 10 years. Most stores, banks, lenders, and credit card companies automatically report to the major credit bureaus on a monthly basis. This is so despite the fact that you did not use the account during that time period. Potential lenders desire to see your credit use and spending patterns for a substantial time period to help them determine your "creditworthiness".

  Frequently during the loan application and approval process a potential borrower is advised that there is a debt or "blemish" on his or her credit report and the lender wants it paid or otherwise removed from the credit history before they will approve a new loan. Credit bureaus only report negative information about your credit for a period of 7 years. Late payments occurring prior to 1992 will not be revealed to someone examining your credit history. Even extremely derogatory reports such as foreclosures, bankruptcies, or judgment liens will be eliminated once they become more than 7 year old. Therefore if you filed for bankruptcy protection in 1991 that fact will not appear on your credit history in 1999.

  One exception to the "7 year rule" is the United States Internal Revenue Service. The IRS will often report its tax lien again to the credit bureaus to create a fictional new "new activity" on the account to resurrect the negative report for another 7 years. Some credit bureaus will use a similar device to recreate an old debt but they usually do not employ the practice unless there is a substantial amount of money owed.

  If there is a dispute between you and a creditor claimed that you owe a debt it is the creditor's burden to prove the existence of the debt. It is not up to you to prove that the debt does not exist. If the creditor cannot prove a debt exists by means of an unpaid invoice or similar proof the credit bureau is obliged to remove the item.

  Often a debt is "sold" to another party who then attempts to collect it. This can be the source of some confusion to a debtor because the name that shows up on the credit report may be unfamiliar to the debtor. For example, Home Depot may sell its debt to HFC resulting in a debt owed to HFC showing on your credit report when you had no direct dealings with HFC. You still have to deal with HFC if the underlying debt is valid and proven.

Mechanic's Lien

Almost everybody has heard of a mechanics lien but most people cannot tell you what it is. Despite its name, it is not a lien placed by an auto mechanic (those do exist and aren't called mechanics liens but that is a story for another day).

A mechanics lien is a lien placed on real estate by a person or company that supplies improvements to the real estate but is not paid. For instance, if a plumber repairs a leaking pipe and then is not paid, he can file a lien against the property but must do so within 90 days of the last day he worked on the property.

Interestingly, this can be done without a court order. Property can be liened simply on the strength of a statement signed under oath attesting to the debt. Of course, a party who has a lien wrongfully placed on their property can apply to a Court for a release of the lien.

Mechanics liens come up frequently in the context of new construction since so many people and companies have supplied materials and labor that went into the construction of the house. Many people who have bought new houses and paid for them in full have been surprised to have liens placed against the property after the closing due to the builder not paying all of the subcontractors . This may occur since the lien may be placed against the property even if the owner is different from the person who requests the work to be done.

Many attorneys recommend that buyers of new homes purchase title insurance to protect against the risk of a mechanics lien. Title insurance will defend a claim made by a lienor and will pay any loss incurred as a result of the lien. Attorneys also require that the builder supply a mechanics lien waiver which is a document signed by all parties who may have a right to lien in which they give up their lien rights.


This pamphlet, prepared by the Connecticut Bar Association, is based upon Connecticut law in effect at the time of its publication and is intended for general information purposes only.  It is issued as a public service and is not a substitute for obtaining legal advice from a Connecticut Attorney.


Buying and Selling a Home / Your Family Lawyer /
If you are in an Auto Accident / Why you Should Have a Will /
Your Rights When Arrested /
Barry L. Thompson, resume / Michael V. Vollono, resume
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