Consumer Handbook to credit protection

Costs of Settlement on a House

A house is probably the single largest credit purchase for most most consumers--and one of the most complicated. The Real Estate Settlement Procedures Act, like Truth in Lending, is a disclosure law. The Act, administered by the Department of Housing and Urban Development, requires the lender to give you, in advance, certain information about the costs you will pay when you close the loan.

This event is called settlement or closing, and the law helps you you shop for lower settlement costs. To find out more about it, write to:

Deputy Assistant Secretary for Housing Attention: RESPA Enforcement U. . Department of Housing and Urban Development 451 Seventh Street, S.W. Room 5241 Washington, D.C. 20410 Should you need to phone: (202) 708-4560 A Federal Reserve pamphlet, entitled "A Consumer's Guide to e to Mortgage Closing Costs," also contains useful information for consumers. APPLYING FOR CREDIT

Discrimination When you're ready to apply for credit, you should know what cred creditors think is important in deciding whether you're creditworthy. You should also know what they cannot legally consider in their decisions.

What Law Applies?

EQUAL CREDIT OPPORTUNITY ACT requires that all credit redit applicants be considered on the basis of their actual qualifications for credit and not be turned away because of certain personal characteristics. What Creditors Look For

The Three C's. Creditors look for an ability to repay debt and t and a willingness to do so--and sometimes for a little extra securit to protect their loans. They speak of the three C's of credit-capacity, character, and collateral.

Capacity. Can you repay the debt? Creditors ask for employment ment information: your occupation, how long you've worked, and how muc you earn. They also want to know your expenses: how many dependents you have, whether you pay alimony or child support, and the amount of your other obligations.