Truth in Lending Act (TILA, 1968)

1) Link to the Text of the Act
Read the statute (15 U.S.C. § 1601 et seq.)

2) Why It Was Done
TILA was enacted to ensure consumers receive clear and accurate information about the costs of credit, preventing deceptive practices and enabling informed borrowing decisions.

3) Pre-existing Law or Constitutional Rights
Before TILA, credit terms were often hidden or misleading, with no standardized disclosure requirements. State laws varied widely, creating confusion and abuse.

4) Overreach or Proper Role?
Supporters say it promotes transparency and consumer choice. Critics argue compliance is burdensome for lenders and can complicate credit markets.

5) Who or What It Controls

• Lenders and creditors (must disclose key terms such as APR, finance charges, and payment schedules)
• Consumers (gain rights to clear loan information and rescission in some transactions)
• Federal regulators (initially the Federal Reserve, now the CFPB)

6) Key Sections / Citations

• 15 U.S.C. § 1601: Congressional findings and purpose
• 15 U.S.C. § 1635: Right of rescission for certain home-secured loans
• 15 U.S.C. § 1637: Open-end credit disclosures (e.g., credit cards)

7) Recent Changes or Live Controversies

• Dodd–Frank Act (2010): Transferred rulemaking to the Consumer Financial Protection Bureau (CFPB)
• TILA now includes major sub-regulations like Regulation Z
• Ongoing debates over payday lending, mortgage disclosures, and arbitration clauses

8) Official Sources

• U.S. Code – Title 15, Chapter 41
• Consumer Financial Protection Bureau – TILA/Regulation Z
• Federal Reserve – Truth in Lending

• Consumer Protection
• Finance
• Credit
• Lending
• Disclosure