Which Federal Consumer Credit Law Governs Credit Term Advertising?

The Federal Consumer Credit Protection Act, specifically outlined in Title VI of the Consumer Credit Protection Act, serves as a vital legal framework safeguarding sensitive information managed by consumer reporting agencies. These agencies encompass entities like credit bureaus, medical information companies, and tenant screening services. Under this act, the data contained within a consumer report is strictly regulated. It is prohibited from being disclosed to individuals or entities without a clearly defined and lawful purpose as stipulated in the Act. This legislative measure ensures that personal financial and medical information is handled with utmost care and confidentiality, offering crucial protections for consumers’ privacy and security.

The federal consumer credit law that mandates specific cost disclosure requirements for both the annual percentage rate (APR) and the finance charge as a dollar amount is known as the Truth in Lending Act (TILA). This law enforces the disclosure of the finance charge, which represents the cost of consumer credit expressed in monetary terms. In essence, TILA ensures that consumers receive clear and transparent information about the financial aspects of their credit agreements, allowing them to make informed decisions regarding borrowing.