A landmark federal legislation establishing rules of disclosure that lenders must observe in dealings with borrowers, ensuring transparent consumer lending practices.
Regulation Z is a body of regulations promulgated by the Federal Reserve Board pursuant to the federal Truth in Lending Act (TILA), ensuring that borrowers are informed of the terms of credit, including the Annual Percentage Rate (APR) and the total cost of credit.
The Truth in Lending Act (TILA) is a federal law designed to ensure that consumers are provided with accurate and transparent information regarding the cost of credit, allowing them to compare credit offers more effectively. It mandates commercial lenders to disclose the annual interest rate and total interest charges, and provides borrowers a three-day rescission period for certain secured loans.
