477
‘‘(I) a significant number of different
annual percentage rates;
‘‘(II) a significant number of different
account balances;
‘‘(III) a significant number of dif-
ferent minimum payment amounts; and
‘‘(IV) that only minimum monthly
payments are made and no additional ex-
tensions of credit are obtained; and
‘‘(iii) promulgate regulations that provide
instructional guidance regarding the manner in
which the information contained in the table es-
tablished under clause (i) should be used in re-
sponding to the request of an obligor for any
information required to be disclosed under sub-
paragraph (A), (B), or (C).
‘‘(I) The disclosure requirements of this para-
graph do not apply to any charge card account, the
primary purpose of which is to require payment of
charges in full each month.
‘‘(J) A creditor that maintains a toll-free tele-
phone number for the purpose of providing cus-
tomers with the actual number of months that it will
take to repay the customer’s outstanding balance is
478
not subject to the requirements of subparagraph (A)
or (B).
‘‘(K) A creditor that maintains a toll-free tele-
phone number for the purpose of providing cus-
tomers with the actual number of months that it will
take to repay an outstanding balance shall include
the following statement on each billing statement:
‘Making only the minimum payment will increase
the interest you pay and the time it takes to repay
your balance. For more information, call this toll-
free number: llll.’ (the blank space to be filled
in by the creditor).’’.
(b) REGULATORY IMPLEMENTATION.—
(1) IN GENERAL.—The Board of Governors of
the Federal Reserve System (hereafter in this title
referred to as the ‘‘Board’’) shall promulgate regula-
tions implementing the requirements of section
127(b)(11) of the Truth in Lending Act, as added
by subsection (a) of this section.
(2) EFFECTIVE DATE.—Section 127(b)(11) of
the Truth in Lending Act, as added by subsection
(a) of this section, and the regulations issued under
paragraph (1) of this subsection shall not take effect
until the later of—
479
(A) 18 months after the date of enactment
of this Act; or
(B) 12 months after the publication of
such final regulations by the Board.
(c) STUDY OF FINANCIAL DISCLOSURES.—
(1) IN GENERAL.—The Board may conduct a
study to determine the types of information available
to potential borrowers from consumer credit lending
institutions regarding factors qualifying potential
borrowers for credit, repayment requirements, and
the consequences of default.
(2) FACTORS
FOR
CONSIDERATION.—In con-
ducting a study under paragraph (1), the Board
should, in consultation with the other Federal bank-
ing agencies (as defined in section 3 of the Federal
Deposit Insurance Act), the National Credit Union
Administration, and the Federal Trade Commission,
consider the extent to which—
(A) consumers, in establishing new credit
arrangements, are aware of their existing pay-
ment obligations, the need to consider those ob-
ligations in deciding to take on new credit, and
how taking on excessive credit can result in fi-
nancial difficulty;
480
(B) minimum periodic payment features
offered in connection with open end credit plans
impact consumer default rates;
(C) consumers make only the required
minimum payment under open end credit plans;
(D) consumers are aware that making only
required minimum payments will increase the
cost and repayment period of an open end cred-
it obligation; and
(E) the availability of low minimum pay-
ment options is a cause of consumers experi-
encing financial difficulty.
(3) REPORT TO CONGRESS.—Findings of the
Board in connection with any study conducted under
this subsection shall be submitted to Congress. Such
report shall also include recommendations for legis-
lative initiatives, if any, of the Board, based on its
findings.
SEC. 1302. ENHANCED DISCLOSURE FOR CREDIT EXTEN-
SIONS SECURED BY A DWELLING.
(a) OPEN END CREDIT EXTENSIONS.—
(1) 
CREDIT
APPLICATIONS.—Section
127A(a)(13) of the Truth in Lending Act (15
U.S.C. 1637a(a)(13)) is amended—
481
(A) by striking ‘‘CONSULTATION OF TAX
ADVISER.—A statement that the’’ and inserting
the following: ‘‘TAX DEDUCTIBILITY.—A state-
ment that—
‘‘(A) the’’; and
(B) by striking the period at the end and
inserting the following: ‘‘; and
‘‘(B) in any case in which the extension of
credit exceeds the fair market value (as defined
under the Internal Revenue Code of 1986) of
the dwelling, the interest on the portion of the
credit extension that is greater than the fair
market value of the dwelling is not tax deduct-
ible for Federal income tax purposes.’’.
(2) CREDIT ADVERTISEMENTS.—Section 147(b)
of the Truth in Lending Act (15 U.S.C. 1665b(b))
is amended—
(A) by striking ‘‘If any’’ and inserting the
following:
‘‘(1) IN GENERAL.—If any’’; and
(B) by adding at the end the following:
‘‘(2) CREDIT
IN
EXCESS
OF
FAIR
MARKET
VALUE.—Each advertisement described in subsection
(a) that relates to an extension of credit that may
exceed the fair market value of the dwelling, and
482
which advertisement is disseminated in paper form
to the public or through the Internet, as opposed to
by radio or television, shall include a clear and con-
spicuous statement that—
‘‘(A) the interest on the portion of the
credit extension that is greater than the fair
market value of the dwelling is not tax deduct-
ible for Federal income tax purposes; and
‘‘(B) the consumer should consult a tax
adviser for further information regarding the
deductibility of interest and charges.’’.
(b) NON-OPEN END CREDIT EXTENSIONS.—
(1) CREDIT APPLICATIONS.—Section 128 of the
Truth in Lending Act (15 U.S.C. 1638) is
amended—
(A) in subsection (a), by adding at the end
the following:
‘‘(15) In the case of a consumer credit trans-
action that is secured by the principal dwelling of
the consumer, in which the extension of credit may
exceed the fair market value of the dwelling, a clear
and conspicuous statement that—
‘‘(A) the interest on the portion of the
credit extension that is greater than the fair
483
market value of the dwelling is not tax deduct-
ible for Federal income tax purposes; and
‘‘(B) the consumer should consult a tax
adviser for further information regarding the
deductibility of interest and charges.’’; and
(B) in subsection (b), by adding at the end
the following:
‘‘(3) In the case of a credit transaction described in
paragraph (15) of subsection (a), disclosures required by
that paragraph shall be made to the consumer at the time
of application for such extension of credit.’’.
(2) CREDIT ADVERTISEMENTS.—Section 144 of
the Truth in Lending Act (15 U.S.C. 1664) is
amended by adding at the end the following:
‘‘(e) Each advertisement to which this section applies
that relates to a consumer credit transaction that is se-
cured by the principal dwelling of a consumer in which
the extension of credit may exceed the fair market value
of the dwelling, and which advertisement is disseminated
in paper form to the public or through the Internet, as
opposed to by radio or television, shall clearly and con-
spicuously state that—
‘‘(1) the interest on the portion of the credit ex-
tension that is greater than the fair market value of
484
the dwelling is not tax deductible for Federal income
tax purposes; and
‘‘(2) the consumer should consult a tax adviser
for further information regarding the deductibility of
interest and charges.’’.
(c) REGULATORY IMPLEMENTATION.—
(1) IN GENERAL.—The Board shall promulgate
regulations implementing the amendments made by
this section.
(2) 
EFFECTIVE
DATE.—Regulations 
issued
under paragraph (1) shall not take effect until the
later of—
(A) 12 months after the date of enactment
of this Act; or
(B) 12 months after the date of publica-
tion of such final regulations by the Board.
SEC. 1303. DISCLOSURES RELATED TO ‘‘INTRODUCTORY
RATES’’.
(a) INTRODUCTORY RATE DISCLOSURES.—Section
127(c) of the Truth in Lending Act (15 U.S.C. 1637(c))
is amended by adding at the end the following:
‘‘(6) ADDITIONAL NOTICE CONCERNING ‘INTRO-
DUCTORY RATES’.—
‘‘(A) IN GENERAL.—Except as provided in
subparagraph (B), an application or solicitation
485
to open a credit card account and all pro-
motional materials accompanying such applica-
tion or solicitation for which a disclosure is re-
quired under paragraph (1), and that offers a
temporary annual percentage rate of interest,
shall—
‘‘(i) use the term ‘introductory’ in im-
mediate proximity to each listing of the
temporary annual percentage rate applica-
ble to such account, which term shall ap-
pear clearly and conspicuously;
‘‘(ii) if the annual percentage rate of
interest that will apply after the end of the
temporary rate period will be a fixed rate,
state in a clear and conspicuous manner in
a prominent location closely proximate to
the first listing of the temporary annual
percentage rate (other than a listing of the
temporary annual percentage rate in the
tabular 
format 
described 
in 
section
122(c)), the time period in which the intro-
ductory period will end and the annual
percentage rate that will apply after the
end of the introductory period; and
486
‘‘(iii) if the annual percentage rate
that will apply after the end of the tem-
porary rate period will vary in accordance
with an index, state in a clear and con-
spicuous manner in a prominent location
closely proximate to the first listing of the
temporary annual percentage rate (other
than a listing in the tabular format pre-
scribed by section 122(c)), the time period
in which the introductory period will end
and the rate that will apply after that,
based on an annual percentage rate that
was in effect within 60 days before the
date of mailing the application or solicita-
tion.
‘‘(B) EXCEPTION.—Clauses (ii) and (iii) of
subparagraph (A) do not apply with respect to
any listing of a temporary annual percentage
rate on an envelope or other enclosure in which
an application or solicitation to open a credit
card account is mailed.
‘‘(C) CONDITIONS
FOR
INTRODUCTORY
RATES.—An application or solicitation to open
a credit card account for which a disclosure is
required under paragraph (1), and that offers a
487
temporary annual percentage rate of interest
shall, if that rate of interest is revocable under
any circumstance or upon any event, clearly
and conspicuously disclose, in a prominent man-
ner on or with such application or solicitation—
‘‘(i) a general description of the cir-
cumstances that may result in the revoca-
tion of the temporary annual percentage
rate; and
‘‘(ii) if the annual percentage rate
that will apply upon the revocation of the
temporary annual percentage rate—
‘‘(I) will be a fixed rate, the an-
nual percentage rate that will apply
upon the revocation of the temporary
annual percentage rate; or
‘‘(II) will vary in accordance with
an index, the rate that will apply after
the temporary rate, based on an an-
nual percentage rate that was in ef-
fect within 60 days before the date of
mailing the application or solicitation.
‘‘(D) DEFINITIONS.—In this paragraph—
‘‘(i) the terms ‘temporary annual per-
centage rate of interest’ and ‘temporary
488
annual percentage rate’ mean any rate of
interest applicable to a credit card account
for an introductory period of less than 1
year, if that rate is less than an annual
percentage rate that was in effect within
60 days before the date of mailing the ap-
plication or solicitation; and
‘‘(ii) the term ‘introductory period’
means the maximum time period for which
the temporary annual percentage rate may
be applicable.
‘‘(E) RELATION
TO
OTHER
DISCLOSURE
REQUIREMENTS.—Nothing in this paragraph
may be construed to supersede subsection (a) of
section 122, or any disclosure required by para-
graph (1) or any other provision of this sub-
section.’’.
(b) REGULATORY IMPLEMENTATION.—
(1) IN GENERAL.—The Board shall promulgate
regulations implementing the requirements of section
127(c)(6) of the Truth in Lending Act, as added by
this section.
(2) EFFECTIVE
DATE.—Section 127(c)(6) of
the Truth in Lending Act, as added by this section,
489
and regulations issued under paragraph (1) of this
subsection shall not take effect until the later of—
(A) 12 months after the date of enactment
of this Act; or
(B) 12 months after the date of publica-
tion of such final regulations by the Board.
SEC. 1304. INTERNET-BASED CREDIT CARD SOLICITATIONS.
(a) 
INTERNET-BASED
SOLICITATIONS.—Section
127(c) of the Truth in Lending Act (15 U.S.C. 1637(c))
is amended by adding at the end the following:
‘‘(7) INTERNET-BASED SOLICITATIONS.—
‘‘(A) IN GENERAL.—In any solicitation to
open a credit card account for any person under
an open end consumer credit plan using the
Internet or other interactive computer service,
the person making the solicitation shall clearly
and conspicuously disclose—
‘‘(i) the information described in sub-
paragraphs (A) and (B) of paragraph (1);
and
‘‘(ii) the information described in
paragraph (6).
‘‘(B) FORM OF DISCLOSURE.—The disclo-
sures required by subparagraph (A) shall be—
490
‘‘(i) readily accessible to consumers in
close proximity to the solicitation to open
a credit card account; and
‘‘(ii) updated regularly to reflect the
current policies, terms, and fee amounts
applicable to the credit card account.
‘‘(C) DEFINITIONS.—For purposes of this
paragraph—
‘‘(i) the term ‘Internet’ means the
international computer network of both
Federal and non-Federal interoperable
packet switched data networks; and
‘‘(ii) the term ‘interactive computer
service’ means any information service,
system, or access software provider that
provides or enables computer access by
multiple users to a computer server, in-
cluding specifically a service or system that
provides access to the Internet and such
systems operated or services offered by li-
braries or educational institutions.’’.
(b) REGULATORY IMPLEMENTATION.—
(1) IN GENERAL.—The Board shall promulgate
regulations implementing the requirements of section
491
127(c)(7) of the Truth in Lending Act, as added by
this section.
(2) EFFECTIVE DATE.—The amendment made
by subsection (a) and the regulations issued under
paragraph (1) of this subsection shall not take effect
until the later of—
(A) 12 months after the date of enactment
of this Act; or
(B) 12 months after the date of publica-
tion of such final regulations by the Board.
SEC. 1305. DISCLOSURES RELATED TO LATE PAYMENT
DEADLINES AND PENALTIES.
(a) DISCLOSURES RELATED
TO LATE PAYMENT
DEADLINES
AND PENALTIES.—Section 127(b) of the
Truth in Lending Act (15 U.S.C. 1637(b)) is amended
by adding at the end the following:
‘‘(12) If a late payment fee is to be imposed
due to the failure of the obligor to make payment on
or before a required payment due date, the following
shall be stated clearly and conspicuously on the bill-
ing statement:
‘‘(A) The date on which that payment is
due or, if different, the earliest date on which
a late payment fee may be charged.
492
‘‘(B) The amount of the late payment fee
to be imposed if payment is made after such
date.’’.
(b) REGULATORY IMPLEMENTATION.—
(1) IN GENERAL.—The Board shall promulgate
regulations implementing the requirements of section
127(b)(12) of the Truth in Lending Act, as added
by this section.
(2) EFFECTIVE DATE.—The amendment made
by subsection (a) and regulations issued under para-
graph (1) of this subsection shall not take effect
until the later of—
(A) 12 months after the date of enactment
of this Act; or
(B) 12 months after the date of publica-
tion of such final regulations by the Board.
SEC. 1306. PROHIBITION ON CERTAIN ACTIONS FOR FAIL-
URE TO INCUR FINANCE CHARGES.
(a) PROHIBITION ON CERTAIN ACTIONS FOR FAIL-
URE TO INCUR FINANCE CHARGES.—Section 127 of the
Truth in Lending Act (15 U.S.C. 1637) is amended by
adding at the end the following:
‘‘(h) PROHIBITION ON CERTAIN ACTIONS FOR FAIL-
URE TO INCUR FINANCE CHARGES.—A creditor of an ac-
count under an open end consumer credit plan may not
493
terminate an account prior to its expiration date solely be-
cause the consumer has not incurred finance charges on
the account. Nothing in this subsection shall prohibit a
creditor from terminating an account for inactivity in 3
or more consecutive months.’’.
(b) REGULATORY IMPLEMENTATION.—
(1) IN GENERAL.—The Board shall promulgate
regulations implementing the requirements of section
127(h) of the Truth in Lending Act, as added by
this section.
(2) EFFECTIVE DATE.—The amendment made
by subsection (a) and regulations issued under para-
graph (1) of this subsection shall not take effect
until the later of—
(A) 12 months after the date of enactment
of this Act; or
(B) 12 months after the date of publica-
tion of such final regulations by the Board.
SEC. 1307. DUAL USE DEBIT CARD.
(a) REPORT.—The Board may conduct a study of,
and present to Congress a report containing its analysis
of, consumer protections under existing law to limit the
liability of consumers for unauthorized use of a debit card
or similar access device. Such report, if submitted, shall
494
include recommendations for legislative initiatives, if any,
of the Board, based on its findings.
(b) CONSIDERATIONS.—In preparing a report under
subsection (a), the Board may include—
(1) the extent to which section 909 of the Elec-
tronic Fund Transfer Act (15 U.S.C. 1693g), as in
effect at the time of the report, and the imple-
menting regulations promulgated by the Board to
carry out that section provide adequate unauthorized
use liability protection for consumers;
(2) the extent to which any voluntary industry
rules have enhanced or may enhance the level of pro-
tection afforded consumers in connection with such
unauthorized use liability; and
(3) whether amendments to the Electronic
Fund Transfer Act (15 U.S.C. 1693 et seq.), or re-
visions to regulations promulgated by the Board to
carry out that Act, are necessary to further address
adequate protection for consumers concerning unau-
thorized use liability.
SEC. 1308. STUDY OF BANKRUPTCY IMPACT OF CREDIT EX-
TENDED TO DEPENDENT STUDENTS.
(a) STUDY.—
(1) IN GENERAL.—The Board shall conduct a
study regarding the impact that the extension of