What must lenders disclose under TILA when extending credit?

Under the Truth in Lending Act (TILA), lenders are required to disclose key information to borrowers when extending credit, which includes the annual percentage rate (APR) and finance charges. This regulation is designed to promote transparency in lending by ensuring that borrowers are fully aware of the cost of credit and the terms associated with their loans.

The APR provides a standard measure of the cost of borrowing, including interest and other fees expressed as a yearly rate, allowing borrowers to compare different credit offers easily. The finance charges reflect the total cost of borrowing, which adds to the borrower’s understanding of the loan’s overall expenses. By requiring the disclosure of this information, TILA aims to help consumers make informed decisions regarding their loans and understand the implications of the credit they are receiving.

In contrast, information such as a borrower's financial history, specific property appraisal values, and insurer details are not mandated disclosures under TILA. While these pieces of information may be relevant in other contexts or under different regulations, they do not fall within the specific requirements of TILA, which focuses on clearly presenting the cost and terms associated with the credit being offered.