Consumer Protection: Your Rights as a Borrower

Federal and state laws protect you as a borrower regardless of which lender you work with, what loan type you choose, or how you found the lender. These protections apply whether you borrow through a bank, a credit union, an online lender, or a lender you were connected with through a matching service like LendUp. This page summarizes key protections in plain language - it is not a complete statement of all your rights, and it is not legal advice. For your specific situation, consult a legal professional or your state's financial regulator.

• Right to see full terms before signing: under the Truth in Lending Act (TILA), lenders must disclose the APR, finance charge, amount financed, and total of payments before you agree to a loan. If any of these are missing from an offer, you should not proceed until the lender provides them.
• Right to walk away: you are never obligated to accept a loan offer. Receiving an offer - whether directly from a lender or through a matching service - does not commit you to anything. You can review the terms and decline at no cost.
• Right to know the lender's identity: before you agree to a loan, you should know who the lender is. If the lender's identity isn't clear on the offer, ask before signing.
• Right to equal treatment: under the Equal Credit Opportunity Act (ECOA), lenders cannot discriminate based on race, color, religion, national origin, sex, marital status, age, or because you receive public assistance. If you believe you've been denied unfairly, you can file a complaint.
• Right to know why you were denied: if a lender denies your application, they are generally required to tell you why - or to tell you that you have the right to request the reason. This is called an adverse action notice.

• Right to the terms you agreed to: the lender must honor the terms in the signed agreement. If the lender changes the rate, fees, payment amount, or due date without your consent, that may be a violation of the agreement or of state law.
• Right to stop automatic payments: you can stop a preauthorized electronic transfer by notifying your bank or credit union at least three business days before the scheduled debit. You can also revoke authorization with the lender in writing. Stopping the debit does not cancel the debt - you still owe the balance and must arrange another payment method. See payday repayment details or installment repayment details.
• Right to accurate account and credit information: if you believe the lender is applying payments incorrectly or charging fees that weren't disclosed, you have the right to dispute the error with the lender directly. If the lender reports inaccurate information to a credit bureau, you can dispute the error with the credit bureau as well. Keep records of payments, correspondence, and dispute submissions. See the credit report guide.
• Protection from unauthorized withdrawals: after two consecutive failed withdrawal attempts, a covered lender generally must obtain new authorization before trying again. These protections took effect for covered lenders beginning in 2025. Not all lenders are covered - if you believe a lender is making repeated unauthorized withdrawal attempts, contact your bank and file a complaint.

• Right to communicate with the lender: if you know you'll miss a payment, contact the lender before the due date. Many lenders have processes for hardship, modified payment arrangements, or extended payment plans - but you usually have to ask.
• Right to fair debt collection: if your debt is sent to a third-party collector, the Fair Debt Collection Practices Act (FDCPA) protects you. Collectors cannot harass you, lie about what you owe, threaten actions they can't legally take, or contact you at unreasonable times. You can request validation of the debt in writing.
• Protection from garnishment without court process: for ordinary consumer debt, wage or bank garnishment generally requires a court process and judgment. If you're being threatened with garnishment without any court involvement, that may be a violation of your rights or a scam.
• Right to know the statute of limitations: every state has a statute of limitations on debt - a time period after which a creditor or collector generally cannot sue to collect. If a collector contacts you about very old debt, understanding your state's statute of limitations matters. See debt collection rights.

Federal law sets a floor of protections, but your state may provide additional ones. State-level protections vary significantly and may include:

• Rate and fee caps: many states set maximum interest rates and fees for payday and installment loans. If a lender charges more than your state allows, that may be a violation of state law.
• Rollover restrictions: some states prohibit or limit payday loan rollovers. If a lender offers you a rollover in a state that restricts it, that may be a violation.
• Extended payment plan requirements: some states require payday lenders to offer an extended payment plan if you can't repay on time. Availability and terms depend on state law or lender policy.
• Cooling-off periods: some states require a waiting period between payday loans to prevent immediate reborrowing.
• Licensing requirements: lenders must be licensed in the states where they operate. A lender operating without a required license is not subject to the same oversight and fee caps that protect borrowers.

Your state's specific rules are on your state's rates, fees, and rules page.

If something goes wrong - with a lender, a collector, or the matching process - here's where to go:

About a lender's practices

• Consumer Financial Protection Bureau (CFPB): handles complaints about lenders involving deceptive practices, unauthorized charges, disclosure violations, and other federal consumer protection concerns. You can submit a complaint online and track its status.
• Your state's financial regulator: handles complaints about state-licensed lenders, including fee-cap violations, licensing issues, and state-law violations. Find your state's regulator.

About fraud or scams

• Federal Trade Commission (FTC): report advance-fee scams, fake lenders, identity theft related to loan applications, and other fraudulent activity.

About the LendUp matching process

• Contact LendUp: if the issue involves how the matching process worked, if you believe you were connected with an unlicensed lender, or if you have concerns about how this site handled your information. LendUp does not service loans and cannot resolve disputes about loan terms, payments, or account servicing - those go to the lender or the regulators above.

Some situations are not just bad terms - they're illegal. Watch for:

• Upfront fees before funding: if someone says you're approved and asks you to pay before receiving the loan - especially by gift card, wire, or payment app - it's a scam. Legitimate lenders deduct fees from proceeds or add them to the balance; they don't ask for payment before disbursement.
• Unlicensed lenders: if a lender can't show you a state license or isn't in your state's license directory, your state's fee caps and regulatory protections may not apply.
• "Guaranteed approval" with no verification: no legitimate lender promises approval without reviewing your income, identity, or other information.
• Threats of arrest or criminal charges for unpaid debt: in the United States, you generally cannot be arrested for failing to repay a consumer debt. If someone threatens arrest over an unpaid loan, that is likely a scam or an illegal threat.

For a more detailed guide to identifying and reporting scams, see scams and safety.

These are the major federal laws referenced on this page. Each protects different aspects of the borrowing experience:

• Truth in Lending Act (TILA) / Regulation Z: requires lenders to disclose APR, finance charge, amount financed, and total of payments before you agree.
• Equal Credit Opportunity Act (ECOA) / Regulation B: prohibits discrimination in lending and requires adverse action notices when applications are denied.
• Electronic Fund Transfer Act (EFTA) / Regulation E: protects consumers who authorize electronic debits, including the right to stop preauthorized transfers.
• Fair Debt Collection Practices Act (FDCPA): regulates how third-party debt collectors can contact you and what they can say or do when collecting a debt.
• Fair Credit Reporting Act (FCRA): gives you the right to access your credit reports, dispute inaccurate information, and requires that information reported about you is accurate. If a lender or collector reports something wrong, you can dispute it with the credit bureau.

For the full text of these laws, visit CFPB's rules and policy page.