Truth in lending act

What are the criminal penalties for violating regulations Z

$5000 fine and/or one year

How long does the creditor have to return any money or property or take action to show termination of the transaction when consumer rescinds

20 days

What is the CHARM booklet

A book titled consumer handbook on adjustable rate mortgages

For initial disclosures what is the definition of business day

A day where the creditor is customarily open to the public for caring on substantially all the creditors business functions

TILA requires two additional disclosures for A.R. M on a consumers principal loan term greater than 12 months one is the charm booklet

A disclosure for every adjustable program in which the consumer expresses an interest

advertising for variable-rate credit

APR may increase or subject to change. Must be disclosed on advertisement

What are the civil remedies for failure to comply with TILA for class action lawsuit

Actual damages An amount ordered by the court with no minimum requirement but up to 500,000 or 1% of brokers/ creditors net worth whichever is less

What information is disclosed under reg Z with TILA

Annual percentage rate finance charge and amount financed

According to TILA what is considered an advertisement

Anything that is produced with the intent to sell a credit plan

What four conditions need to be met for truth in lending or reg Z to apply

Credit is offered to the consumers Credit is offered on a regular basis The credit is subject to a finance charge or must be paid in more than four installments The credit is primarily for personal family or household purposes

When are truth in lending disclosures required for open end credit (revolving) or Helocs

Disclosures must be made before the first transaction takes place and again with the periodic billing statement

What are examples of terms that do not trigger the required disclosures on advertisements

Easy monthly payments Low down payment accepted Pay weekly Financing available Small down payments accepted

What act is TILA a part of

Federal consumer credit protection act

Which fees are not included in the finance charge and annual percentage rate

Fees for title escrow or loan prep for documents notarizing fees appraisal fees credit report fees

Fax about oral rate disclosures

If a consumer Orally asks about a credit plan The loan originator must state the APR first

What is MDIA II

In September 2010 the board of the federal reserve issued an interim rule MDIA II Then in December 2010 the board again changed TILA by modifying regulation Z by issuing another interim roll helping to clarify and implement MDIA II

What about a closed and credit arrangement where the borrowers required to pay the principal amount according to a set payment schedule

Initial disclosure must be made within three business days of application. The final APR disclosure is required to be accurate within 1/8 or .125% for regular loans and .25 for arm loans

What are the stipulations for the right to rescind notice

It must be on a separate document Identified the rescission period On the transaction Clearly and conspicuously disclose the retention or acquisition of the security interest in the consumers principal dwelling Must outline the consumers right to rescind Instruct the consumer to exercise the right to resend by using the form for that purpose

When did TILA come into play

It was passed as part of Hera the housing and economic recovery act of 2008. It was passed in July 2008 for implementation in July 2009

What Can a consumer do to waive the right to rescission

It would have to be because of the bona fide financial emergency. The consumer must provide the creditor with the dated written statement that describes the emergency specifically waves or modifies the right to resend and contains all of the concerned consumers signatures

July rule 2008 is what

MDIA made changes to Tilla by modifying reg Z

What are some advertising rules with TILA

Must disclose the APR if you are listing any number Regulation Z reaches out to everyone involved in an advertisement regardless of their industries

Can internal rate sheets be provided to the customer and why?

No they should not be shared with customers sharing them may trigger certain till the disclosures if the creditors using them in a way that could be construed as advertising

What is bait and switch advertising

Offering credit plans that they don't intend to honor so they can offer something completely different to the borrower once they get their interest

What are the civil remedies for failure to comply with TILA an individual cases

Payment of actual damages attorneys fees and court cost and statutory damages up to two times the amount of the finance charge as long as this figure is at or above 100 or below 1000

What are trigger terms

Phrases that represent the most attractive features of a credit plan in the context of an ad

What is another name for the truth in lending act

Regulation Z

New disclosure requirements for adjustable-rate loans

The December rule clarifies the requirement that for adjustable rate and step rate loans creditors disclose the max interest rate and payment during the first five years- this must be the first five years after the first regular periodic payment due date rather than the first five years after consummation

What is an example of a trigger term

The amount of the down payment either as a percentage or dollar amount The amount of any payment The number of payments or the period of repayment The amount of any finance charge That there is no charge for credit

what is the annual percentage rate or APR

The annual cost of credit in the form of an annual interest rate the mortgage buyer will pay after all the closing costs and other charges are taken into consideration

Who is responsible for administering the rules of Tilla

The board of governors of the Federal Reserve however specific enforcement of the law is delegated to the federal banking agencies depending on the type of loan as well as the entity that offered the loan

If a trigger term exists the ad must disclose all of what

The cash price of the home The amount of the down payment required or that none is required whatever's applicable The number of payments necessary to repay the loan The amount of payments Due dates or period of payment scheduled to repay the debt and the APR of the finance charge

What is the finance charge

The cost of credit in an exact dollar amount

What is TILA

The truth in lending act is the statute that requires creditors to disclose key terms and costs to consumers for credit transactions

If there are any errors or disclosures are not delivered till when does the right to rescind extend till

Three years after consummation, upon transfer of all the consumers interest in the property or upon sale of the property whichever occurs first

For the right of rescission what must the creditor supply to the owner

Two copies of the right to rescind notice along with one copy of the disclosure statement.

How long must a broker or creditor keep evidence of compliance with TILA regulations

Two years after the disclosure date. But the mortgage loan originator should also check with the respect of licensing state for retention requirements

When does reg Z not apply

When credit is extended for business commercial or agricultural

When is the consumers notice to rescind considered given

When it is delivered to the creditors place of business

When must a consumer bring a lawsuit for Tilla violation

Within one year of the actual violation. If more than one year after the lenders violation then violations in the TILA can be used as a defense and counterclaim by the consumer for up to three years

If there are more than one borrower on the loan, can one person rescind for the rest

Yes