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FRS

RIN: 7100-AD08

Publication ID: Spring 2009

Title: Regulation Z--Truth in Lending (Docket No. R-1286)
Abstract: The Board is conducting a review of Regulation Z, which implements the Truth in Lending Act (TILA). In June 2007, the Board published a notice of proposed rulemaking (NPRM) to amend the regulation, and the regulation's official staff commentary, for rules affecting open-end (revolving) credit that is not home secured. The Board published advance notices of proposed rulemakings seeking comment on a variety of issues affecting the open-end credit in December 2004 and October 2005. The NPRM seeks comment, among other issues, on amendments that highlight fees and penalty rates in disclosures accompanying credit and charge card applications and solicitations, require a summary of terms when accounts are opened, and breakout costs for fees and interest on periodic statements. The proposal implements amendments to TILA contained in federal bankruptcy reform legislation. Advance notice would be required when penalty rates are imposed, and the time of advance notice for changed terms would be extended. Two alternatives are proposed dealing with the "effective" annual percentage rate disclosed on periodic statements. In May 2008, the Board published a second NPRM, seeking comment on a limited number of additional revisions to the regulation and commentary. Among other issues, the new proposed amendments address creditors' responsibilities to establish reasonable instructions for receiving timely payments and when a due date falls on a weekend or holiday. Creditors' responsibilities when investigating a claim of unauthorized transactions or an allegation of a billing error are also addressed. Advertisements for deferred interest plans would be required to provide additional information about how interest could be imposed. On December 18, 2008, the Board issued final rules amending Regulation Z, substantially similar to the proposed amendments contained in the June 2007 and May 2008 NPRMs. With respect to the two alternatives dealing with the "effective" annual percentage rate in the June 2007 proposal, the final rule deletes the requirement for creditors to provide the "effective" annual percentage rate on periodic statements. In addition, the final rule withdrew the proposed amendments related to advertisements for deferred interest plans, because substantive restrictions on these plans were adopted in the Board's final rule amending Regulation AA, which was also issued on December 18, 2008.
Agency: Federal Reserve System(FRS)	Priority: Substantive, Nonsignificant
RIN Status: Previously published in the Unified Agenda	Agenda Stage of Rulemaking: Completed Actions
Major: No	Unfunded Mandates: No
CFR Citation: 12 CFR 226 et seq
Legal Authority: 15 USC 1601 et seq

Legal Deadline: None

Timetable:

Action	Date	FR Cite
Board Requested Comment	06/14/2007	72 FR 32948
Board Requested Further Comment	07/18/2008	73 FR 28866
Board Adopted FInal Rule	01/29/2009	74 FR 5244

Regulatory Flexibility Analysis Required: Yes	Government Levels Affected: None
Small Entities Affected: Businesses	Federalism: No
Included in the Regulatory Plan: No
RIN Data Printed in the FR: Yes
Agency Contact: Krista Ayoub Counsel Federal Reserve System Division of Consumer and Community Affairs, Phone:202 452-3667