For Closed-End Credit (e.g., loans, mortgages):
* Finance Charge: The total dollar amount the borrower will pay for credit, including interest, fees, and other charges.
* Annual Percentage Rate (APR): The annual cost of credit, expressed as a percentage. This is a crucial figure for comparison shopping.
* Amount Financed: The amount of credit provided to the borrower after subtracting any down payment or other fees.
* Total of Payments: The total amount the borrower will repay over the life of the loan.
* Payment Schedule: The number, amounts, and due dates of payments.
* Late Payment Charges: Any penalties for late payments.
* Prepayment Penalties: Any charges for paying off the loan early.
* Security Interest: A description of any property used as collateral for the loan.
Specific disclosures depend on the type of credit: Mortgage loans have additional disclosures required under the Real Estate Settlement Procedures Act (RESPA), and home equity loans have their own set of requirements.
For Open-End Credit (e.g., credit cards):
* Periodic Rate: The interest rate charged for each billing cycle.
* Annual Percentage Rate (APR): Similar to closed-end credit, but can vary depending on the type of purchase and other factors.
* Minimum Payment: The minimum amount due each month.
* Balance Calculation Method: How the balance is calculated for interest charges (e.g., average daily balance).
* Late Payment Fees: Penalties for late payments.
* Other Fees: Any additional fees, such as annual fees, cash advance fees, or balance transfer fees.
Other Important Requirements:
* Clear and Concise Language: Disclosures must be easy to understand, avoiding jargon and complex terms.
* Timing of Disclosures: Disclosures must be provided at specific times, usually before the credit is extended.
* Rescission Rights: For certain types of credit (e.g., home equity loans), borrowers have the right to rescind the loan within a certain period (usually three business days) after signing the agreement.
* Advertising Requirements: Advertisements for credit must be truthful and not misleading. If certain credit terms are advertised, others must be disclosed as well.
Failure to comply with TILA can result in significant penalties for lenders, including fines and legal action. Consumers who believe a lender has violated TILA can file a complaint with the Consumer Financial Protection Bureau (CFPB).