ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The Truth in Lending Act (TILA) protects you against inaccurate and unfair credit billing and credit card practices. It requires lenders to provide you with loan cost information so that you can comparison shop for certain types of loans.

Detailed explanation-2: -TILA disclosures include the number of payments, the monthly payment, late fees, whether a borrower can prepay the loan without penalty and other important terms. TILA disclosures is often provided as part of the loan contract, so the borrower may be given the entire contract for review when the TILA is requested.

Detailed explanation-3: -The finance charge is the cost of consumer credit as a dollar amount. It includes any charge payable directly or indirectly by the consumer and imposed directly or indirectly by the creditor as an incident to or a condition of the extension of credit.

Detailed explanation-4: -The TILA only covers creditors that are regularly engaged in extending credit for goods and services (such as banks, department stores, suppliers, wholesalers, and retailers) plus those that are regularly engaged in arranging credit that is for personal, family, or household goods (such as a mortgage broker).

Detailed explanation-5: -Some examples of violations are the improper disclosure of the amount financed, finance charge, payment schedule, total of payments, annual percentage rate, and security interest disclosures. Under TILA, a creditor can be strictly liable for any violations, meaning that the creditor’s intent is not relevant.