Revisions to Regulation Z Truth in Lending Act

The Board of Governors of the Federal Reserve System (FRS) has adopted final revisions to Regulation Z, which implements the Truth in Lending Act. Attached is the final rule that took effect on November 21, 1997, with mandatory compliance by December 22, 1997. The revisions implement an amendment to the Truth In Lending Act contained in the Economic Growth and Regulatory Paperwork Reduction Act of 1996.

The specific changes to the regulation include:

• Revisions to Section 226.19(b)(2), “Certain Variable-Rate Transactions,” that permit creditors to provide either:
  • The historical 15-year example of index values or
  • A statement that the periodic payment on certain variable-rate loans may substantially increase or decrease together with a maximum interest rate and payment based on a $10,000 loan amount;
• Revisions to Appendix H that provide new model forms and clauses for the revisions made to Section 226.19(b); and
• Changes to the “Official Staff Commentary” in Sections 226.19(b)(2) and Appendix H that provide additional guidance on the revised disclosure requirements.

To obtain copies of any regulations or official staff commentaries, you may contact FRS Publications at (202) 452-3245.