Applicable Financing

• The Truth in Lending Act applies to credit transactions financed by private individuals or companies that deal in monetary loans. The credit loaned must have a finance charge and payment schedule. Consumers are the beneficiaries of the act, and any credit extended to families, individuals or farms is subject to the act. Businesses or commercial interests that apply for credit cannot take advantage of the stipulations in the Truth in Lending Act.
  
  

Purpose

• The Truth in Lending Act protects consumers from unfair or misleading creditors who do not readily provide all of the details about credit transactions. The Act stipulates that any credit institution giving credit to non-commercial or non-business consumers must clearly provide the annual percentage rate, or APR, credit terms and methods for dispute resolution in the contract. It is the job of the consumer to look at the terms provided to make appropriate decisions regarding credit.
  
  

Rate Amounts

• Credit lenders must disclose the cost of lending to customers, according to the Truth in Lending Act. Lenders must tell you the annual percentage rate, or APR; the finance charge, or the cost of credit in dollars; the total amount financed , the money you will receive; and the total of payments, or the fiance charge and loan combined. If an institution does not provide details about the cost of your credit, the institution may be fined or brought to court.
  
  

Penalties

• The Truth in Lending Act is meant to protect consumers who borrow money. If a lending institution violates the Act, they are responsible for the damages you incur. Additionally, any of your attorney's fees and costs are to be borne by the lending institution. The Truth in Lending Act takes precedence over all state laws regarding credit and lending.