When you take out a loan for a car, mortgage, or school, it’s important to understand the terms and conditions of the contract you’re agreeing to. Unfortunately, many of these documents contain confusing language and complex legal jargon, leading many to sign without fully understanding the most important matters, and in the past, lenders have taken advantage of this. As such, the Truth in Lending Act (TILA) was introduced to protect borrowers from these predatory practices. Keep reading to learn more about your rights and discover how a California consumer lawyer can help you if you believe your rights were violated.
What Is the Truth in Lending Act and What Protections Does It Offer?
The Truth in Lending Act (TILA) was introduced in 1968 to help protect consumers from predatory lenders. This makes it so lenders must offer certain information to borrowers before authorizing a loan. They must document and explicate the terms of a loan. This includes annual percentage rates (APR), loan terms, payment amounts, and penalties.
This act also allows consumers to back out of a loan within three days without financial penalties. This is to help protect consumers who feel pressured into taking out a loan by pushy or manipulative sales associates.
Aside from ensuring consumers have full transparency regarding the loans they take out, one of the most important benefits of this act is that it allows consumers the right to shop around for loans. Because consumers are aware of the terms and conditions of a loan before signing a legally binding contract, this allows borrowers to explore their options, keeping lenders competitive. This benefits consumers in the long run.
The Truth in Lending Act has also been expanded over time to include the Fair Credit Billing Act, the Fair Credit and Charge Card Disclosure Act, the Home Equity Consumer Protection Act, and the Home Ownership and Equity Protection Act.
What Should I Do if My Rights Are Violated?
If you have reason to believe that your rights were violated, whether this is due to a creditor failing to disclose extra charges, loans, or penalties, you may be able to pursue a claim against the lender.
As a victim of a TILA violation, you are entitled to damages under the law. This includes actual damages you may have sustained because of the infringement and statutory damages. This helps hold the creditor liable for violations.
Additionally, you are protected from predatory lending practices under the law. Essentially, this means the creditor cannot use deception, charge excessive amounts for tasks, or use unethical means to obtain more money.
Have your rights under TILA been violated by a deceptive lender? If so, the team at LA Legal Solutions can help you through these challenging times. Connect with us today to discuss your circumstances with a member of our team.
