What is the Truth in Lending Act?

The Truth in Lending Act (TILA) is a federal law that requires lenders to provide honest and accurate information to consumers when they take out loans. This law was enacted in 1968, and it applies to banks, credit unions, and other types of lenders in all states, including Georgia. The Truth in Lending Act requires that lenders disclose all of the costs associated with a loan in writing, such as the APR, the total costs of the loan over the term of the loan, and any associated fees. By providing this information up front, the law makes it easier for consumers to understand what they are agreeing to and what their obligations are with regards to the loan. When a consumer takes out a loan, the lender is also required to provide a “Statement of Right to Cancel,” which gives the borrower three business days to review the loan agreement and cancel it without penalty. This protects consumers from being charged fees or penalties for cancelling a loan. The Truth in Lending Act also includes protections for consumers in the event of a dispute with their lender. If a borrower feels that their lender has violated the terms of their loan agreement, they can file a complaint with the Consumer Financial Protection Bureau. The bureau will investigate the complaint and if the lender is found to have violated the law, the borrower can receive compensation.

Related FAQs

Are there any regulations governing ATM use?
What is the National Bankruptcy Reform Act?
What is the Federal Reserve System?
What is the Alternative Mortgage Transaction Parity Act?
What is the Federal Banking Agency Regulatory Relief Act?
What is the Truth in Savings Act?
What is FDIC insurance?
What is the Payment Card Industry Data Security Standard?
What is the Check Clearing for the 21st Century Act?
What is the Equal Credit Opportunity Act?

What is the Truth in Lending Act?

Related FAQs

Related Blog Posts