Equal Credit Opportunity Act (ECOA), Truth in Lending Act (TILA)

Question 1

The Equal Credit Opportunity Act (ECOA) is enforced by the ___ ____ ____ ___

Answer 1

Consumer Financial Protection Bureau

Question 2

What does ECOA require?

Answer 2

that financial institutions make credit available without discrimination on the basis of race, color, religion, national origin, sex, marital status, age, or receipt of public assistance

Question 3

What is the Truth in Lending Act?

Answer 3

It regulates what information lenders must make known to consumers about their products and services

Question 4

Who implements the Truth in Lending Act?

Answer 4

Federal Reserve Regulation Z

Question 5

What are the required credit costs that need to be disclosed under TILA?

Answer 5

• Truth in Lending disclosure
• Annual percentage rate (APR)
• total payments

Question 6

The TILA makes _____ advertising a federal offense

Answer 6

bait-and-switch

Question 7

Specific words in an ad that trigger additional information required

Answer 7

• amount or percentage of down payment
• terms of repayment
• annual percentage rate

Question 8

What is the right of rescission?

Answer 8

Allows a party to cancel a contract without penalty within a specific timeframe

Question 9

Does the right of rescission apply to first mortgages?

Answer 9

no

Question 10

The right of rescission applies to most consumer loans, including ___, ___, and ___

Answer 10

home equity lines of credit, second mortgages, and refinance loans