closed end credit trigger terms

If any triggering term is used in a closed-end credit advertisement then the following three disclosures must also be included in that advertisement. Iii The amount of any payment.

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The amount of any payment expressed either as a percentage or as a dollar amount.

. The number of payments or period of repayment such as 48-month payment term or 30-year mortgage this is often the most overlooked triggering term The amount of any payment 550 per month The amount of any finance charge 500 origination fee 2 points. I The amount or percentage of any downpayment. The periodic rate used to compute the finance charge or the annual percentage rate.

If any of the following terms is set forth in an advertisement the advertisement shall meet the requirements of paragraph d 2 of this section. Once you are approved for closed-end credit youll receive the funds upfront and then repay it with interest in monthly installments over the loans term. The number of payments.

Iii The amount of any payment. Click card to see definition. 22624 - Closed end credit 1 Triggering terms.

22624 - Closed end credit. Ii The number of payments or period of repayment. The correct answer is.

The terms of repayment. Before we focus on ARMs lets examine the general trigger term and additional disclosure requirements that apply to all advertisements for closed-end credit under Regulation Z. Closed-end credit such as an installment loan or auto loan is for a specific dollar amount and time period.

The amount or percentage of the down payment. If any of the following terms is set forth in an advertisement the advertisement must include the additional disclosures described in D2. The period of repayment the total time required to repay.

What are trigger terms for Closed End credit. So what is closed-end credit. Official interpretation of 24 d 1 Triggering Terms Show i The amount or percentage of any downpayment.

For example if an advertisement for credit secured by a dwelling offers 300000 of credit with a 30-year loan term for a payment of 600 per month for the first six months increasing to 1500 per month after month six followed by a balloon payment of 30000 at the end of the loan term the advertisement must disclose the amount and time. Triggering terms for closed-end loans. How Closed-End Credit Works.

The annual percentage rateusing that term spelled out in full. Section 102616b applies even if the triggering term is not stated explicitly but may be readily determined from the advertisement. Finance Charge Accrual Timing.

Every day except Sundays and Federal holidays. However disclosures arent required when lenders use phrases that arent defined as triggering terms for closed-end credit products such as. If the annual percentage rate may be increased after consummation of credit.

Open-end credit plans such as HELOCs Reverse mortgage loans Timeshare plans Temporary or bridge loans with terms of 12 months or less A construction phase with a period of 12 months or less as part of a construction-to-permanent loan Extensions of credit by government agencies. 102660 Credit and charge card applications and solicitations. The amount of any finance charge.

4 No down payment 10 APR Rate loans are available Easy monthly payments Loans available at 10 below our standard APR Low down payments Pay each week There are terms to fit your budget. Iv The amount of any finance charge. With closed end credit when you originally apply for a loan with the lender the terms never change.

2 The number of payments or period of repayment. The triggering terms are. A membership fee is not a triggering term nor need it be disclosed under 102616b1iii if it is required for participation in the plan whether or not an open-end credit feature is.

The amount of the down payment expressed either as a percentage or as a dollar amount. For instance a few terms for closed end credit that trigger the need for additional disclosure are. Ii The number of payments or period of repayment.

Closed end loan trigger terms. Unless you pay off the loan early the final. Closed-end home equity loans The following are excluded.

A trigger term is used when advertising what type of credit plan.

Truth In Lending Act Tila Consumer Rights Protections