Violations of the Truth In Lending Act (TILA) may entitle you to either cash compensation or a reduction of your loan balance/
If your TILA rights have been violated in an interaction with a car dealership in the past three years, you may be entitled to compensation. To learn more and explore your options with an experienced attorney, contact Kagan Law today. Call us or contact us online to set up your consultation.
What Is The Truth In Lending Act (TILA)?
The Truth in Lending Act (TILA) is a federal statute established in 1968 with the aim of safeguarding consumers during their interactions with lenders and creditors. The Federal Reserve Board executed the provisions of TILA through a sequence of regulatory measures.
Certain key elements of the TILA revolve around the necessary details that must be revealed to a borrower prior to granting credit. These include:
- The annual percentage rate (APR)
- The loan duration
- The complete expenses incurred by the borrower
These particulars should be clearly evident on the documents provided to the borrower prior to endorsement, and in certain instances, on the borrower’s recurring billing statements.
An important extension of the Truth in Lending Act is the Consumer Leasing Act (CLA). The CLA requires:
- Description of the property
- Initial payment amount
- Charges encompassing official fees, license fees, taxes, registration, and certificate of title
- Additional obligatory charges not covered by periodic payments
- Lessee’s responsibility for end-of-lease wear-and-tear expenses
- Option for property purchase at the lease term’s conclusion
- Overview of lessor-provided or consumer-required insurance coverage
- Explanation of the lessor’s security interest
- Quantity of payments, their respective amounts, and due dates
- Terms for lease termination
CLA regulations only offer protection for leases intended for personal use that exceed four months and are valued at or less than $50,000.
Why Is TILA Important?
The Truth In Lending regulations are important because they protect consumers. Under TILA regulations, creditors and lenders are required to provide consumers with information on how they handle their financial products and services. TILA promotes transparency and prevents consumers from being deceived and paying more than they should.
Before a lender can ask you to sign the loan contract, you should be provided with a statement that includes:
- Amount financed – This signifies the credit amount extended to you—essentially, the total sum you’re borrowing.
- Finance charges – These encompass the complete interest and specific fees that you’ll discharge throughout the loan’s lifespan if you uphold timely payment.
- Annual Percentage Rate (APR) – The APR denotes the credit cost presented as a yearly percentage rate.
- Total of payments – This aggregates all payments rendered by the loan’s culmination, inclusive of the principal reimbursement and the full array of finance charges.
- And other important terms – The TILA statement must also furnish you with details regarding the payment count, monthly installment, potential late fees, prepayment feasibility devoid of penalties, and other pivotal terms.
What Do TILA Violations Look Like At A Car Dealership?
TILA violations can take on many forms, so it is important to be aware of how they may manifest. Some examples of how they may manifest when interacting with a car dealership may include:
- Providing an inaccurate presentation of the APR and finance charge
- Erroneously using the daily interest factor
- Imposing a penalty fee that surpasses the limits stipulated by the TILA
- Denying the borrower the ability to rescind the agreement within the specified timeframe
- And more
- Additional fees that were not disclosed in the lease
- Excessive fees added on for wear and tear (wear and tear fees are permissible, but they must be reasonable)
- Security fees that exceed the amount of two monthly payments, or are not returned at the end of the lease term (so long as the lease was not violated)
- Excessive mileage fees that were not disclosed in the original agreement
What Do CLA Violations Look Like At A Car Dealership?
CLA violations can show up in various ways, such as:
- Additional fees that were not disclosed in the lease
- Excessive fees added on for wear and tear (wear and tear fees are permissible, but they must be reasonable)
- Security fees that exceed the amount of two monthly payments, or are not returned at the end of the lease term (so long as the lease was not violated)
- Excessive mileage fees that were not disclosed in the original agreement
What To Do If You Feel Your Truth In Lending Rights Have Been Violated
If you’ve recently engaged with an automotive dealership that you suspect is involved in deceptive or inequitable trade practices, there are several measures you can undertake to amass evidence, should you decide to initiate a complaint. These measures encompass:
Maintain Documentation: Preserve records of your interactions with the car dealership, encompassing agreements, receipts, correspondence, electronic communications, and other relevant materials.
Initiate Contact with the Establishment: Consider communicating with the business to explore potential resolution avenues. Ensure that you document these exchanges.
Lodge a Formal Grievance: The Florida Office of the Attorney General is responsible for investigating and prosecuting violations of the Florida Deceptive and Unfair Trade Practices Act (FDUTPA). Submitting a complaint to this office will apprise them of businesses potentially participating in deceptive and unjust practices.
Seek Legal Counsel: Get in touch with a skilled attorney for guidance. They can furnish you with a professional assessment of your situation and assist you in ascertaining the viability of your claim. Should you possess a valid claim, they can aid you in devising an optimal course of action.
How Kagan Law Can Help You
When you work with us you get:
- Experienced Attorneys – We are well-versed in TILA violations and have significant experience handling consumer safety claims.
- A Team With Resources – We have the resources and connections needed to help you build a solid case and win the compensation you are entitled to.
- Skilled Negotiators & Litigators – Our attorneys are skilled negotiators with experience in the negotiation process, and we are not afraid to go to trial if necessary.
Frequently Asked Questions
What To Do If You Suspect Your Truth In Lending Rights Have Been Violated By A Car Dealership
If you suspect your TILA rights have been violated by a car dealership, contact an experienced attorney for help. TILA rights are technical in nature and pursuing justice on your own can be difficult without a solid understanding of the complicated TILA regulations. An experienced attorney can provide you with sound legal advice and help you create a strong claim.
What Compensation Can I Recover If My TILA Rights Were Violated?
If your TILA rights were infringed upon, you may be eligible to secure various forms of compensation to rectify the harm you suffered. This compensation may include the reimbursement of down payments, interest payments, attorney’s fees, and other direct financial losses.
If your claim falls under CLA violations you may qualify for up to $2000 in penalties as well as statutory fees.
How Long Do I Have To File A Claim?
The statute of limitations for TILA violation claims is one year from the date of the agreement. It is important to get started with an attorney as soon as you become suspicious that your rights were violated so they can work quickly with you to build your case and so that you do not miss the statute of limitations deadline.
Let The Kagan Law Firm Help You File Your TILA Claim
If your TILA or CLA rights have been violated by a car dealership, you may have legal recourse and be eligible for compensation. Let the attorneys of Kagan Law Firm help. Our experienced professionals will never share confidential information with unauthorized third parties. Get started today with a free consultation to learn more about your options. Call us at or contact us online.