TILA

Truth in Lending Act (TILA), also known as Regulation Z, is a consumer protection law enacted in 1968 in response to exceedingly predatory loan practices. Prior to TILA, lenders would use a variety of differing terminology and forms of lending that manipulated or misled uninformed borrowers. TILA changed this by requiring a uniform system of disclosures and terminology to be used for lending like credit cards or mortgages. Creditors were required to disclose details like the annual percentage rate and repayment details in a way that is clear to borrowers, or else the borrower may be able to rescind the debt. TILA also limits the amount of late fees creditors can charge. Since its signing, TILA has been updated to respond to changing lending practices to ensure borrowers clearly understand the terms and conditions that they agree to. 

[Last reviewed in August of 2026 by the Wex Definitions Team]

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