Key Terms
Consumer law
The area of law dealing with consumer transactions — credit, goods, real property, or services obtained for personal, fa
Consumer protection laws
Laws designed to protect consumers against unfair trade and credit practices, faulty goods, and dangerous products.
Goal
Prevent businesses from taking advantage of individual consumers.
General principle
Advertising must be honest. Consumers must be able to make informed decisions based on what products and services actual
Puffery
A broad promotional statement that is not intended to be taken literally; an exaggerated opinion. Examples: "the best,"
Deceptive advertising
A material misrepresentation or omission that is likely to mislead a potential customer and would mislead a reasonable c
Bait and switch
A sales practice where a seller advertises a low-priced product to lure consumers into a store, then pressures them to b
Hazardous materials
Products deemed dangerous to the consuming public. Includes drugs that may be consumed safely in small amounts under med
Debtor
Someone who owes an obligation to another, especially the obligation to pay money. A consumer becomes a debtor when they
Purpose
Prevent abusive practices by debt collectors. Many businesses prefer to collect outside of court because the judicial pr
Scope
Individual consumer information only. Does NOT apply to business entities' credit reports.
Credit bureau
An organization that maintains and distributes credit worthiness information to creditors, insurance companies, and empl
Credit freeze
Consumer restricts or prohibits creditors from requesting their credit report without the consumer's permission. The con
Applies to
Electronic direct deposits and withdrawals, ATMs, and point- of-sale transactions with merchants.
Preauthorized transfer
An electronic fund transfer authorized in advance to recur at regular intervals (example: monthly mortgage payment auto-