Definition of Regulation Z:
Regulation Z applies to many types of consumer credit. That includes home mortgages, home equity lines of credit, reverse mortgages, credit cards, installment loans, and certain kinds of student loans.
Regulation Z is the Federal Reserve Board regulation that implemented the Truth in Lending Act of 1968, which was part of the Consumer Credit Protection Act of that same year. The act’s major goals were to provide consumers with better information about the true costs of credit and to protect them from certain misleading practices by the lending industry. Under these rules, lenders must disclose interest rates in writing, give borrowers the chance to cancel certain types of loans within a specified period, use clear language about loan and credit terms, and respond to complaints, among other provisions. The terms Regulation Z and Truth in Lending Act (TILA) are often used synonymously.
A federal legislation under the Truth in Lending Act that requires lenders to advise the borrower in writing of all costs that are associated with the credit portion of a financial transaction.
How to use Regulation Z in a sentence?
- It applies to home mortgages, home equity lines of credit, reverse mortgages, credit cards, installment loans, and certain kinds of student loans.
- It was established as part of the Consumer Credit Protection Act of 1968.
- Regulation Z protects consumers from misleading practices by the credit industry and provides them with reliable information about the costs of credit.
Meaning of Regulation Z & Regulation Z Definition