The Truth in Lending Act explained

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What is the Truth in Lending Act?

The Truth in Lending Act (TILA) is a law created by the United States government in 1968. The purpose of the TILA is to protect borrowers by making them aware of the terms of a loan before they accept it.

Why is the Truth in Lending Act important?

The Truth in Lending Act looks after borrowers both before and after a loan contract is signed. Before this act was created there was little regulation over personal loans. The TILA now ensures each borrower clearly understands their loan’s terms before accepting it.

How does the Truth in Lending Act protect me?

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  • The date when the loan will be paid back
  • Late fees
  • Number of payments until the loan is repaid
  • The amount of a typical monthly payment
  • Any penalties for paying back your loan early

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