What is the Truth in Lending Act?
The Truth in Lending Act is a federal law designed to inform borrowers of the terms of their loans. The law requires those who loan money, such as banks, to fully disclose the terms of their lending agreements. This applies to mortgage loans, as well. Understanding the terms of your mortgage can help you avoid foreclosure. You may also be able to resist foreclosure if your bank violates the terms of your mortgage agreement.
The Truth in Lending Act was passed in 1968. Since then, it has protected tens of millions of borrowers from unscrupulous lending practices. According to the law, banks have to reveal all the costs associated with a loan. For example, when a bank offers a mortgage, they must tell the borrower:
- The repayment period
- The method for calculating interest
- Any fees associated with the mortgage
The Truth in Lending Act requires this openness so that consumers will know what is expected of them. A bank usually cannot change the terms of a loan. Unfortunately, the Truth in Lending Act has not put an end to high interest rates or foreclosures. If you have questions about your mortgage, or if you feel your bank is violating the terms of your loan, you may wish to consult a lawyer.
Contact Us
The Law Offices of Eric N. Klein & Associates, P.A., may be able to tell you more about the Truth in Lending Act and its implications. If you have questions about this or any other aspect of foreclosure defense, call our West Palm Beach foreclosure defense lawyers at 561-353-2800.
