The Truth in Lending Act abbreviated as (TILA)

The Truth in Lending Act (TILA)

The Truth in Lending Act, also known as TILA, is a federal statute that was passed in the United States in 1968. (Peterson, 2003). Consumers are to be shielded by TILA from credit card practices as well as unfair and erroneous credit billing. Disclosures made under TILA fail to keep up with the variety of credit products available to consumers. Despite efforts to make the disclosures more user-friendly, the issue still exists. By reducing the overreliance on these disclosures and concentrating on a more balanced approach to consumer protection, such challenges to the act can be addressed. Although the change seems to move away the federal law from its founding principles, it is an effective way of guaranteeing consumer protection that is uniform for market place’s rational decisions. Reviewing the act has shed light on important issues of concern in the business world such as the need to continue enhancing free market in the world and embracing politically sound methods in credit offering.

The Fair Credit Billing Act (FCBA)

The Fair Credit Billing Act abbreviated as (FCBA) was passed in 1975 to act as protection for consumers against unfair credit billing practices (Littlefield, 1975). Under the Act, creditors and consumers are provided with guidelines on matters such as the right procedures in handling disputes concerning billing statements. The implementation of the Act seems to be reluctant and not so effective in dealing with lenders who violate protocols. The challenge is rampant when considering starters who seem to ignore or lack the full knowledge of the Act. The solution to the problem is being more strict in dealing with violators and sensitizing the guiding principles under the Act. Reviewing the law was important and added business knowledge particularly on credit and overdraft checking accounts.

References

Littlefield, N. O. (1975). Federal Consumer Credit Legislation-Some New Developments-Part I: Fair Credit Billing. Com. LJ, 80, 312.

Peterson, C. L. (2003). Truth, understanding, and high-cost consumer credit: The historical context of the truth in lending act. Fla. L. Rev., 55, 807.