What is the Truth in Lending Act?

The Truth in Lending Act (TILA) is a consumer protection law that applies to any lender who issues consumer credit in Texas. It was enacted in 1968 and is enforced by the Federal Trade Commission. Under this law, lenders must disclose information about the cost and terms of any consumer loan transactions. For example, lenders must provide a disclosure statement that includes the cost of the loan, the interest rate and other finance charges, the amount of any payment(s), the loan’s terms, and the total amount that the consumer will pay for the loan. This ensures that consumers know exactly what they are getting into before they agree to any loan. TILA also protects borrowers against certain deceptive or abusive practices by creditors, such as hidden fees, misrepresentation of loan terms, and failure to disclose all relevant information about a loan. In addition, consumers have the right to cancel certain credit transactions within three days. This allows them to decide if they want to proceed with the loan without any pressure. TILA is an important law that helps protect consumers from unfair and deceptive lending practices in Texas.

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What is the Truth in Lending Act?

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