Truth in Lending Act

Truth in Lending Act
The purpose of the Truth-in-Lending Act (15 U.S.C.A. No. 1601 et seq.) is to assure that every customer who has need for consumer credit is given meaningful information with respect to the cost of that credit. In most cases the credit cost must be expressed in the dollar amount of finance charges, and as an annual percentage rate computed on the unpaid balance of the amount financed. Other relevant credit information must also be disclosed so that the customer may compare the various credit terms available to him from different sources and avoid the uninformed use of credit. The Act further provides a customer the right, in certain circumstances, to cancel a credit transaction which involves a lien on his residence. The intent of the Act is to promote the informed use of consumer credit. Adiel v. Chase Fed. Sav. & Loan Ass'n, C.A.Fla., 810 F.2d 1051, 1054.
The requirements of the Act are implemented by Regulation Z of the Federal Reserve Board, 12 CFR pt. 226. Many states have their own Truth-in-Lending Acts, e.g., Mass.G.L. ch. 140D.
See also Consumer Credit Protection Act

Black's law dictionary. . 1990.

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