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Truth in Lending Act: What Lenders Must Tell You

Last Updated: November 2, 2017

How can you be expected to open a credit card or take out a loan if you aren’t told all the terms of the agreement? You can’t, which is why we have the Truth in Lending Act. Enacted in 1968, this law requires lenders to make certain disclosures before extending credit to you. It’s a long list of requirements, but we’ve summarized the basics for you here, including what lenders must state in ads and applications, and what must be included in your billing statements.

Open End Credit

This is also known as revolving credit, meaning there is no end date for it. This includes credit cards, home equity lines of credit, and personal lines of credit.

Before you are extended open end credit, the lender must disclose the following:

The lender must also provide you with a statement each billing cycle, which should include:Truth in lending act - what a lender must tell you

In ads and applications for credit cards, lenders must disclose:

For open end credit secured by a home, lenders must disclose:

Closed End Credit

This is also known as non-revolving credit or installment credit — credit that ends once it is paid off. This includes auto loans, student loans, mortgages, and personal loans.

Before you are extended closed end credit, the lender must disclose the following:

Learn more about the difference between revolving and non-revolving credit.

More on these disclosures

Again, the required disclosures listed here are summarized. To see the specific language of each — as well as more detailed information — you can take a look at the Truth in Lending Act yourself. It’s a lengthy document, but we can at least tell you where to look so you don’t have to weed through the whole thing.

You can scroll through the Act to find the following sections, or you can click the links to go straight to them via Cornell Law School’s website.

For more on:

Other laws you need to know

Credit reporting agencies and debt collection companies have strict laws to follow, too. Get the facts in our Quick Guide to the Fair Credit Reporting Act and FDCPA Violations: What Debt Collectors Cannot Do.

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