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Truth in Lending: 17(b) Time of Disclosures.

1. Consummation. As a general rule, disclosures must be made before “consummation” of the transaction. The disclosures need not be given by any particular time before consummation, except in certain mortgage transactions and variable-rate transactions secured by the consumer’s principal dwelling with a term greater than one year under § 1026.19, and in private education loan transactions disclosed in compliance with §§ 1026.46 and 1026.47. (See the commentary to § 1026.2(a)(13) regarding the definition of consummation.)

Truth in Lending: 17(d) Multiple Creditors; Multiple Consumers.

1. Multiple creditors. If a credit transaction involves more than one creditor:

i. The creditors must choose which of them will make the disclosures.

ii. A single, complete set of disclosures must be provided, rather than partial disclosures from several creditors.

Truth in Lending: 17(e) Effect of Subsequent Events.

1. Events causing inaccuracies.130 Subject to § 1026.19(e) and (f), inaccuracies in disclosures are not violations if attributable to events occurring after the disclosures are made. For example, when the consumer fails to fulfill a prior commitment to keep the collateral insured and the creditor then provides the coverage and charges the consumer for it, such a change does not make the original disclosures inaccurate.

Truth in Lending: 17(f) Early Disclosures.

1. Change in rate or other terms.131 Redisclosure is required for changes that occur between the time disclosures are made and consummation if the annual percentage rate in the consummated transaction exceeds the limits prescribed in § 1026.17(f) even if the prior disclosures would be considered accurate under the tolerances in § 1026.18(d) or 1026.22(a). To illustrate:

i. Transactions not secured by real property or a cooperative unit.

Truth in Lending: 17(g) Mail or Telephone Orders—Delay in Disclosures.

1. Conditions for use.135 Except for extensions of credit subject to § 1026.19(a) or (e) and (f), when the creditor receives a mail or telephone request for credit, the creditor may delay making the disclosures until the first payment is due if the following conditions are met:

i. The credit request is initiated without face-to-face or direct telephone solicitation. (Creditors may, however, use the special rule when credit requests are solicited by mail.)

Truth in Lending: 17(h) Series of Sales—Delay in Disclosures.

1. Applicability.136 Except for extensions of credit covered by § 1026.19(a) or (e) and (f), the creditor may delay the disclosures for individual credit sales in a series of such sales until the first payment is due on the current sale, assuming the two conditions in § 1026.17(h) are met. If those conditions are not met, the general timing rules in § 1026.17(b) apply.

Truth in Lending: 17(i) Interim Student Credit Extensions.

1. Definition. Student credit plans involve extensions of credit for education purposes where the repayment amount and schedule are not known at the time credit is advanced. These plans include loans made under any student credit plan, whether government or private, where the repayment period does not begin immediately. (Certain student credit plans that meet this definition are exempt from Regulation Z. See § 1026.3(f).)

Truth in Lending: Amendment History

[67 Fed. Reg. 16,982 (Apr. 9, 2002); 73 Fed. Reg. 44,606 (July 30, 2008); 74 Fed. Reg. 23,302 (May 19, 2009); 74 Fed. Reg. 41,249 (Aug. 14, 2009); 75 Fed. Reg. 58,486 (Sept. 24, 2010); 76 Fed. Reg. 79,772 (Dec. 22, 2011); 78 Fed. Reg. 79,730 (Dec. 31, 2013); 78 Fed. Reg. 11,017 (Feb. 14, 2013); 80 Fed. Reg. 80,228 (Dec. 24, 2015); 82 Fed. Reg. 37,656 (Aug. 11, 2017)]

Truth in Lending: 1. As applicable; 2. Format; 3. Scope of Coverage

1. As applicable.

i. The disclosures required by this section need be made only as applicable. Any disclosure not relevant to a particular transaction may be eliminated entirely. For example:

A. In a loan transaction, the creditor may delete disclosure of the total sale price.

B. In a credit sale requiring disclosure of the total sale price under § 1026.18(j), the creditor may delete any reference to a downpayment where no downpayment is involved.

Truth in Lending: 18(a) Creditor.

1. Identification of creditor. The creditor making the disclosures must be identified. This disclosure may, at the creditor’s option, appear apart from the other disclosures. Use of the creditor’s name is sufficient, but the creditor may also include an address and/or telephone number. In transactions with multiple creditors, any one of them may make the disclosures; the one doing so must be identified.

Truth in Lending: 18(b) Amount Financed.

1. Disclosure required. The net amount of credit extended must be disclosed using the term amount financed and a descriptive explanation similar to the phrase in the regulation.138

Paragraph 18(b)(1)

Truth in Lending: 18(c) Itemization of Amount Financed.

1. Disclosure required.

i. The creditor has 2 alternatives in complying with § 1026.18(c):

A. The creditor may inform the consumer, on the segregated disclosures, that a written itemization of the amount financed will be provided on request, furnishing the itemization only if the customer in fact requests it.

Truth in Lending: 18(d) Finance Charge.

1. Disclosure required. The creditor must disclose the finance charge as a dollar amount, using the term finance charge, and must include a brief description similar to that in § 1026.18(d). The creditor may, but need not, further modify the descriptor for variable rate transactions with a phrase such as which is subject to change.

Truth in Lending: 18(d)(2) Other Credit.

1. Tolerance. When a finance charge error results in a misstatement of the amount financed, or some other dollar amount for which the regulation provides no specific tolerance, the misstated disclosure does not violate the Act or the regulation if the finance charge error is within the permissible tolerance under this paragraph.

Truth in Lending: 18(e) Annual Percentage Rate.

1. Disclosure required. The creditor must disclose the cost of the credit as an annual rate, using the term annual percentage rate, plus a brief descriptive phrase comparable to that used in § 1026.18(e). For variable rate transactions, the descriptor may be further modified with a phrase such as which is subject to change. Under § 1026.17(a), the terms annual percentage rate and finance charge must be more conspicuous than the other required disclosures.

Truth in Lending: 18(f) Variable Rate.

1. Coverage. The requirements of § 1026.18(f) apply to all transactions in which the terms of the legal obligation allow the creditor to increase the rate originally disclosed to the consumer. It includes not only increases in the interest rate but also increases in other components, such as the rate of required credit life insurance. The provisions, however, do not apply to increases resulting from delinquency (including late payment), default, assumption, acceleration or transfer of the collateral.

Truth in Lending: 18(g) Payment Schedule.

1. Amounts included in repayment schedule. The repayment schedule should reflect all components of the finance charge, not merely the portion attributable to interest. A prepaid finance charge, however, should not be shown in the repayment schedule as a separate payment. The payments may include amounts beyond the amount financed and finance charge.

Truth in Lending: Paragraph 18(h) Total of Payments.

1. Disclosure required. The total of payments must be disclosed using that term, along with a descriptive phrase similar to the one in the regulation. The descriptive explanation may be revised to reflect a variable rate feature with a brief phrase such as “based on the current annual percentage rate which may change.”

Truth in Lending: Paragraph 18(i) Demand Feature.

1. Disclosure requirements. The disclosure requirements of this provision apply not only to transactions payable on demand from the outset, but also to transactions that are not payable on demand at the time of consummation but convert to a demand status after a stated period. In demand obligations in which the disclosures are based on an assumed maturity of 1 year under § 1026.17(c)(5), that fact must also be stated. Appendix H contains model clauses that may be used in making this disclosure.

Truth in Lending: Paragraph 18(j) Total Sale Price.

1. Disclosure required. In a credit sale transaction, the total sale price must be disclosed using that term, along with a descriptive explanation similar to the one in the regulation. For variable rate transactions, the descriptive phrase may, at the creditor’s option, be modified to reflect the variable rate feature.

Truth in Lending: 18(k) Prepayment.

1. Disclosure required.146 The creditor must give a definitive statement of whether or not a prepayment penalty will be imposed or a prepayment rebate will be given.

i. The fact that no prepayment penalty will be imposed may not simply be inferred from the absence of a prepayment penalty disclosure; the creditor must indicate that prepayment will not result in a prepayment penalty.

Truth in Lending: 18(l) Late Payment.

1. Definition. This paragraph requires a disclosure only if charges are added to individual delinquent installments by a creditor who otherwise considers the transaction ongoing on its original terms. Late payment charges do not include:

i. The right of acceleration.

ii. Fees imposed for actual collection costs, such as repossession charges or attorney’s fees.

iii. Deferral and extension charges.

Truth in Lending: 18(n) Insurance and Debt Cancellation.

1. Location. This disclosure may, at the creditor’s option, appear apart from the other disclosures. It may appear with any other information, including the amount financed itemization, any information prescribed by state law, or other supplementary material. When this information is disclosed with the other segregated disclosures, however, no additional explanatory material may be included.