### §1601. Congressional findings and declaration of purpose

#### (a) Informed use of credit

The Congress finds that economic stabilization would be enhanced and the competition among the various financial institutions and other firms engaged in the extension of consumer credit would be strengthened by the informed use of credit. The informed use of credit results from an awareness of the cost thereof by consumers. It is the purpose of this subchapter to assure a meaningful disclosure of credit terms so that the consumer will be able to compare more readily the various credit terms available to him and avoid the uninformed use of credit, and to protect the consumer against inaccurate and unfair credit billing and credit card practices.

#### (b) Terms of personal property leases

The Congress also finds that there has been a recent trend toward leasing automobiles and other durable goods for consumer use as an alternative to installment credit sales and that these leases have been offered without adequate cost disclosures. It is the purpose of this subchapter to assure a meaningful disclosure of the terms of leases of personal property for personal, family, or household purposes so as to enable the lessee to compare more readily the various lease terms available to him, limit balloon payments in consumer leasing, enable comparison of lease terms with credit terms where appropriate, and to assure meaningful and accurate disclosures of lease terms in advertisements.

(Pub. L. 90–321, title I, §102, May 29, 1968, 82 Stat. 146; Pub. L. 93–495, title III, §302, Oct. 28, 1974, 88 Stat. 1511; Pub. L. 94–240, §2, Mar. 23, 1976, 90 Stat. 257.)

#### **Editorial Notes**

#### Amendments

1976—Pub. L. 94–240 designated existing provisions as subsec. (a) and added subsec. (b).

1974—Pub. L. 93–495 inserted provisions expanding purposes of subchapter to include protection of consumer against inaccurate and unfair credit billing and credit card practices.

#### **Statutory Notes and Related Subsidiaries**

#### Effective Date of 2010 Amendment

Pub. L. 111–203, title XIV, §1400(c), July 21, 2010, 124 Stat. 2136, provided that:

"(1) Regulations.—The regulations required to be prescribed under this title [see Tables for classification] or the amendments made by this title shall—

"(A) be prescribed in final form before the end of the 18-month period beginning on the designated transfer date; and

"(B) take effect not later than 12 months after the date of issuance of the regulations in final form.

"(2) Effective date established by rule.—Except as provided in paragraph (3), a section, or provision thereof, of this title shall take effect on the date on which the final regulations implementing such section, or provision, take effect.

"(3) Effective date.—A section of this title for which regulations have not been issued on the date that is 18 months after the designated transfer date shall take effect on such date."

#### Effective Date of 1976 Amendment

Amendment by Pub. L. 94–240 effective on expiration of one year after Mar. 23, 1976, see section 6 of Pub. L. 94–240, set out as an Effective Date note under section 1667 of this title.

#### Effective Date of 1974 Amendment

For effective date of amendment by Pub. L. 93–495, see section 308 of Pub. L. 93–495, set out as an Effective Date note under section 1666 of this title.

#### Effective Date

Pub. L. 90–321, title V, §504(a), May 29, 1968, 82 Stat. 167, provided that: "Except as otherwise specified, the provisions of this Act [see Short Title note set out below] take effect upon enactment [May 29, 1968]."

#### Short Title of 2018 Amendment

Pub. L. 115–174, §1(a), May 24, 2018, 132 Stat. 1296, provided that: "This Act [see Tables for classification] may be cited as the 'Economic Growth, Regulatory Relief, and Consumer Protection Act'."

#### Short Title of 2015 Amendment

Pub. L. 114–94, div. G, title LXXXIX, §89001, Dec. 4, 2015, 129 Stat. 1799, provided that: "This title [amending sections 1639c and 1639d of this title and enacting provisions set out as a note under section 5512 of Title 12, Banks and Banking] may be cited as the 'Helping Expand Lending Practices in Rural Communities Act of 2015' or the 'HELP Rural Communities Act of 2015'."

#### Short Title of 2010 Amendment

Pub. L. 111–319, §1, Dec. 18, 2010, 124 Stat. 3457, provided that: "This Act [amending section 1681m of this title and enacting provisions set out as a note under section 1681m of this title] may be cited as the 'Red Flag Program Clarification Act of 2010'."

Pub. L. 111–203, title XIV, §1400(a), July 21, 2010, 124 Stat. 2136, provided that: "This title [see Tables for classification] may be cited as the 'Mortgage Reform and Anti-Predatory Lending Act'."

#### Short Title of 2009 Amendment

Pub. L. 111–93, §1, Nov. 6, 2009, 123 Stat. 2998, provided that: "This Act [amending section 1666b of this title] may be cited as the 'Credit CARD Technical Corrections Act of 2009'."

Pub. L. 111–24, §1(a), May 22, 2009, 123 Stat. 1734, provided that: "This Act [enacting sections 1616, 1651, 1665c to 1665e, 1666i–1, 1666i–2, and 1693l–1 of this title and section 1a–7b of Title 16, Conservation, amending sections 1602, 1632, 1637, 1640, 1650, 1666b, 1666c, 1666j, 1681b, 1681j, and 1693m to 1693r of this title, enacting provisions set out as notes under sections 1602, 1637, 1638, 1666b, 1681j, and 1693l–1 of this title and section 5311 of Title 31, Money and Finance, and amending provisions set out as notes under sections 1638 and 1693 of this title] may be cited as the 'Credit Card Accountability Responsibility and Disclosure Act of 2009' or the 'Credit CARD Act of 2009'."

#### Short Title of 2008 Amendment

Pub. L. 110–315, title X, §1001, Aug. 14, 2008, 122 Stat. 3478, provided that: "This title [enacting section 1650 of this title and sections 1019d and 9709 of Title 20, Education, amending sections 1602, 1603, 1638, and 1640 of this title, section 2903 of Title 12, Banks and Banking, and section 1092 of Title 20, and enacting provisions set out as notes under sections 1638 and 1640 of this title, section 2903 of Title 12, and section 9709 of Title 20] may be cited as the 'Private Student Loan Transparency and Improvement Act of 2008'."

Pub. L. 110–289, div. B, title V, §2501, July 30, 2008, 122 Stat. 2855, provided that: "This title [amending sections 1638 and 1640 of this title and sections 24 and 338a of Title 12, Banks and Banking, and enacting provisions set out as a note under section 1638 of this title] may be cited as the 'Mortgage Disclosure Improvement Act of 2008'."

Pub. L. 110–241, §1, June 3, 2008, 122 Stat. 1565, provided that: "This Act [amending section 1681n of this title and enacting provisions set out as notes under section 1681n of this title] may be cited as the 'Credit and Debit Card Receipt Clarification Act of 2007'."

#### Short Title of 2003 Amendment

Pub. L. 108–159, §1(a), Dec. 4, 2003, 117 Stat. 1952, provided that: "This Act [enacting sections 1681c–1, 1681c–2, 1681s–3, 1681w, and 1681x of this title and sections 9701 to 9708 of Title 20, Education, amending sections 1681a, 1681b, 1681c, 1681g, 1681i, 1681j, 1681m, 1681o, 1681p, 1681s, 1681s–2, 1681t, 1681u, and 1681v of this title and section 5318 of Title 31, Money and Finance, enacting provisions set out as notes under this section, sections 1681, 1681a, 1681b, 1681c, 1681c–1, 1681i, 1681j, 1681m, 1681n, 1681s–2, 1681s–3 of this title, and section 9701 of Title 20, and amending provisions set out as a note under this section] may be cited as the 'Fair and Accurate Credit Transactions Act of 2003'."

#### Short Title of 1999 Amendment

Pub. L. 106–102, title VII, §701, Nov. 12, 1999, 113 Stat. 1463, provided that: "This subtitle [subtitle A (§§701–705) of title VII of Pub. L. 106–102, amending sections 1693b, 1693c, and 1693h of this title] may be cited as the 'ATM Fee Reform Act of 1999'."

#### Short Title of 1998 Amendment

Pub. L. 105–347, §1, Nov. 2, 1998, 112 Stat. 3208, provided that: "This Act [amending sections 1681a to 1681c, 1681g, 1681i, 1681k, and 1681s of this title and enacting provisions set out as a note under section 1681a of this title] may be cited as the 'Consumer Reporting Employment Clarification Act of 1998'."

#### Short Title of 1996 Amendment

Pub. L. 104–208, div. A, title II, §2401, Sept. 30, 1996, 110 Stat. 3009–426, provided that: "This chapter [chapter 1 (§§2401–2422) of subtitle D of title II of div. A of Pub. L. 104–208, enacting section 1681s–2 of this title, amending sections 1681a to 1681e, 1681g to 1681j, 1681m to 1681o, 1681q to 1681s, and 1681t of this title, and enacting provisions set out as notes under sections 1681a, 1681b, and 1681g of this title] may be cited as the 'Consumer Credit Reporting Reform Act of 1996'."

#### Short Title of 1995 Amendments

Pub. L. 104–29, §1, Sept. 30, 1995, 109 Stat. 271, provided that: "This Act [enacting section 1649 of this title, amending sections 1605, 1631, 1635, 1640, and 1641 of this title, and enacting provisions set out as notes under section 1605 of this title] may be cited as the 'Truth in Lending Act Amendments of 1995'."

Pub. L. 104–12, §1, May 18, 1995, 109 Stat. 161, provided that: "This Act [amending section 1640 of this title] may be cited as the 'Truth in Lending Class Action Relief Act of 1995'."

#### Short Title of 1994 Amendment

Pub. L. 103–325, title I, §151, Sept. 23, 1994, 108 Stat. 2190, provided that: "This subtitle [subtitle B (§§151–158) of title I of Pub. L. 103–325, enacting sections 1639 and 1648 of this title, amending sections 1602, 1604, 1610, 1640, 1641, and 1647 of this title, and enacting provisions set out as notes under this section and section 1602 of this title] may be cited as the 'Home Ownership and Equity Protection Act of 1994'."

#### Short Title of 1992 Amendment

Pub. L. 102–537, §1, Oct. 27, 1992, 106 Stat. 3531, provided that: "This Act [enacting section 1681s–1 of this title, amending section 1681a of this title, and enacting provisions set out as a note under section 1681a of this title] may be cited as the 'Ted Weiss Child Support Enforcement Act of 1992'."

#### Short Title of 1988 Amendments

Pub. L. 100–709, §1, Nov. 23, 1988, 102 Stat. 4725, provided that: "This Act [enacting sections 1637a, 1647, and 1665b of this title, amending sections 1632 and 1637 of this title, and enacting provisions set out as notes under section 1637a of this title] may be cited as the 'Home Equity Loan Consumer Protection Act of 1988'."

Pub. L. 100–583, §1, Nov. 3, 1988, 102 Stat. 2960, provided that: "This Act [amending sections 1610, 1632, 1637, 1640, and 1646 of this title and enacting provisions set out as a note under section 1637 of this title] may be cited as the 'Fair Credit and Charge Card Disclosure Act of 1988'."

#### Short Title of 1981 Amendment

Pub. L. 97–25, §1, July 27, 1981, 95 Stat. 144, provided: "That this Act [amending sections 1602 and 1666f of this title, section 29 of Title 12, Banks and Banking, and sections 205 and 212 of Title 42, The Public Health and Welfare; enacting provisions set out as notes under this section and sections 1602 and 1666f of this title; and amending provisions set out as notes under sections 1602 and 1666f of this title] may be cited as the 'Cash Discount Act'."

#### Short Title of 1980 Amendment

Pub. L. 96–221, title VI, §601, Mar. 31, 1980, 94 Stat. 168, provided that: "This title [enacting section 1646 of this title, amending sections 57a, 1602 to 1607, 1610, 1612, 1613, 1631, 1632, 1635, 1637, 1638, 1640, 1641, 1643, 1663, 1664, 1665a, 1666, 1666d, 1667d, and 1691f of this title, repealing sections 1614, 1636, and 1639 of this title, and enacting provisions set out as notes under sections 1602 and 1607 of this title] may be cited as the 'Truth in Lending Simplification and Reform Act'."

#### Short Title of 1976 Amendments

Pub. L. 94–240, §1, Mar. 23, 1976, 90 Stat. 257, provided that: "This Act [enacting sections 1667 to 1667e of this title, amending this section and section 1640 of this title, and enacting provisions set out as a note under section 1667 of this title] may be cited as the 'Consumer Leasing Act of 1976'."

Pub. L. 94–239, §1(a), Mar. 23, 1976, 90 Stat. 251, provided that: "This Act [enacting section 1691f of this title, amending this section and sections 1691b, 1691c, 1691d, 1691e of this title, repealing section 1609 of this title, enacting provisions set out as notes under this section, and repealing provision set out as a note under this section] may be cited as the 'Equal Credit Opportunity Act Amendments of 1976'."

#### Short Title of 1974 Amendment

Pub. L. 93–495, title III, §301, Oct. 28, 1974, 88 Stat. 1511, provided that: "This title [enacting sections 1666 to 1666j of this title, amending this section and sections 1602, 1610, 1631, 1632, and 1637 of this title, and enacting provision set out as a note under section 1666 of this title] may be cited as the 'Fair Credit Billing Act'."

Pub. L. 93–495, title V, §501, Oct. 28, 1974, 88 Stat. 1521, which provided that title V of Pub. L. 93–495 (enacting subchapter IV of this chapter and notes set out under section 1691 of this title) could be cited as the "Equal Credit Opportunity Act", was repealed by Pub. L. 94–239, §1(c), Mar. 23, 1976, 90 Stat. 251.

#### Short Title

Pub. L. 90–321, §1, May 29, 1968, 82 Stat. 146, provided that: "This Act [enacting this chapter, sections 891 to 896 of Title 18, Crimes and Criminal Procedure, and provisions set out as notes under this section, sections 1631 and 1671 of this title, and section 891 of Title 18] may be cited as the 'Consumer Credit Protection Act'."

Pub. L. 90–321, title I, §101, May 29, 1968, 82 Stat. 146, provided that: "This title [enacting this subchapter] may be cited as the 'Truth in Lending Act'."

Pub. L. 90–321, title IV, §401, as added by Pub. L. 104–208, div. A, title II, §2451, Sept. 30, 1996, 110 Stat. 3009–454, provided that: "This title [enacting subchapter II–A of this chapter] may be cited as the 'Credit Repair Organizations Act'."

Pub. L. 90–321, title VI, §601, as added by Pub. L. 91–508, title VI, §601, Oct. 26, 1970, 84 Stat. 1128, as amended by Pub. L. 108–159, title VIII, §811(a), Dec. 4, 2003, 117 Stat. 2011, provided that: "This title [enacting subchapter III of this chapter] may be cited as the 'Fair Credit Reporting Act'."

Pub. L. 90–321, title VII, §709, as added by Pub. L. 94–239, §1(b), Mar. 23, 1976, 90 Stat. 251, provided that: "This title [enacting subchapter IV of this chapter and notes set out under section 1691 of this title] may be cited as the 'Equal Credit Opportunity Act'."

Pub. L. 90–321, title VIII, §801, as added by Pub. L. 95–109, Sept. 20, 1977, 91 Stat. 874, provided that: "This title [enacting subchapter V of this chapter] may be cited as the 'Fair Debt Collection Practices Act'."

Pub. L. 90–321, title IX, §901, as added by Pub. L. 95–630, title XX, §2001, Nov. 10, 1978, 92 Stat. 3728, provided that: "This title [enacting subchapter VI of this chapter] may be cited as the 'Electronic Fund Transfer Act'."

#### Severability

Pub. L. 90–321, title V, §501, May 29, 1968, 82 Stat. 167, provided that: "If a provision enacted by this Act [see Short Title note above], is held invalid, all valid provisions that are severable from the invalid provision remain in effect. If a provision enacted by this Act is held invalid in one or more of its applications, the provision remains in effect in all valid applications that are severable from the invalid application or applications."

#### Exemption or Modification of Mortgage Disclosure Requirements

Pub. L. 111–203, title XIV, §1405(b), July 21, 2010, 124 Stat. 2142, provided that: "Notwithstanding any other provision of this title [see Tables for classification], in order to improve consumer awareness and understanding of transactions involving residential mortgage loans through the use of disclosures, the Board may, by rule, exempt from or modify disclosure requirements, in whole or in part, for any class of residential mortgage loans if the Board determines that such exemption or modification is in the interest of consumers and in the public interest."

#### Analysis of Further Restrictions on Offers of Credit or Insurance

Pub. L. 108–159, title II, §213(e), Dec. 4, 2003, 117 Stat. 1979, provided that:

"(1) In general.—The Board shall conduct a study of—

"(A) the ability of consumers to avoid receiving written offers of credit or insurance in connection with transactions not initiated by the consumer; and

"(B) the potential impact that any further restrictions on providing consumers with such written offers of credit or insurance would have on consumers.

"(2) Report.—The Board shall submit a report summarizing the results of the study required under paragraph (1) to the Congress not later than 12 months after the date of enactment of this Act [Dec. 4, 2003], together with such recommendations for legislative or administrative action as the Board may determine to be appropriate.

"(3) Content of report.—The report described in paragraph (2) shall address the following issues:

"(A) The current statutory or voluntary mechanisms that are available to a consumer to notify lenders and insurance providers that the consumer does not wish to receive written offers of credit or insurance.

"(B) The extent to which consumers are currently utilizing existing statutory and voluntary mechanisms to avoid receiving offers of credit or insurance.

"(C) The benefits provided to consumers as a result of receiving written offers of credit or insurance.

"(D) Whether consumers incur significant costs or are otherwise adversely affected by the receipt of written offers of credit or insurance.

"(E) Whether further restricting the ability of lenders and insurers to provide written offers of credit or insurance to consumers would affect—

"(i) the cost consumers pay to obtain credit or insurance;

"(ii) the availability of credit or insurance;

"(iii) consumers' knowledge about new or alternative products and services;

"(iv) the ability of lenders or insurers to compete with one another; and

"(v) the ability to offer credit or insurance products to consumers who have been traditionally underserved."

[For definitions of terms used in section 213(e) of Pub. L. 108–159, set out above, see section 2 of Pub. L. 108–159, set out as a Definitions note under section 1681 of this title.]

#### Federal Reserve Study of Home Equity Lending and Appropriate Interest Rate Index

Pub. L. 103–325, title I, §157, Sept. 23, 1994, 108 Stat. 2197, provided that during the period beginning 180 days after Sept. 23, 1994, and ending 2 years after that date, the Board of Governors of the Federal Reserve System was to conduct a study and submit to the Congress a report, including recommendations for any appropriate legislation, regarding whether consumers engaging in open end credit transactions as defined in section 1602 of this title secured by principal dwellings have adequate Federal protection and whether a more appropriate interest rate index existed for purposes of section 1602(bb)(1)(A) of this title than the yield on Treasury securities.

#### Hearings on Home Equity Lending

Pub. L. 103–325, title I, §158, Sept. 23, 1994, 108 Stat. 2197, as amended by Pub. L. 111–203, title X, §1096, July 21, 2010, 124 Stat. 2102, provided that:

"(a) Hearings.—Not less than once during the 3-year period beginning on the date of enactment of this Act [Sept. 23, 1994], and regularly thereafter, the Bureau, in consultation with the Advisory Board to the Bureau, shall conduct a public hearing to examine the home equity loan market and the adequacy of existing regulatory and legislative provisions and the provisions of this subtitle [see Short Title of 1994 Amendment note above] in protecting the interests of consumers, and low-income consumers in particular.

"(b) Participation.—In conducting hearings required by subsection (a), the Bureau shall solicit participation from consumers, representatives of consumers, lenders, and other interested parties."

#### Study by Federal Reserve Board of Governors Covering Effect of Charge Card Transactions Upon Card Issuers, Merchants, and Consumers

Pub. L. 97–25, title II, §202, July 27, 1981, 95 Stat. 145, directed Board of Governors of Federal Reserve System, not later than 2 years after July 27, 1981, to prepare a study and submit its findings to Congress on the effect of charge card transactions upon card issuers, merchants, and consumers.

#### Inference of Legislative Intent in Section Captions and Catchlines

Pub. L. 90–321, title V, §502, May 29, 1968, 82 Stat. 167, provided that: "Captions and catchlines are intended solely as aids to convenient reference, and no inference as to the legislative intent with respect to any provision enacted by this Act [enacting this chapter, section 891 to 896 of Title 18, Crimes and Criminal Procedure, and provisions set out as notes under this section, sections 1631 and 1671 of this title, and section 891 of Title 18] may be drawn from them."

#### Grammatical Usages

Pub. L. 90–321, title V, §503, May 30, 1968, 82 Stat. 167, provided that: "In this Act [enacting this chapter, sections 891 to 896 of Title 18, Crimes and Criminal Procedure, and provisions set out as notes under this section, sections 1631 and 1671 of this title, and section 891 of Title 18]:

"(1) The word 'may' is used to indicate that an action either is authorized or is permitted.

"(2) The word 'shall' is used to indicate that an action is both authorized and required.

"(3) The phrase 'may not' is used to indicate that an action is both unauthorized and forbidden.

"(4) Rules of law are stated in the indicative mood."

#### Definition

Pub. L. 111–203, title XIV, §1495, July 21, 2010, 124 Stat. 2207, provided that: "For purposes of this title [see Tables for classification], the term 'designated transfer date' means the date established under section 1062 of this Act [12 U.S.C. 5582]."