The TRUTH IN LENDING ACT (TILA) Disclosure says that if the Borrower pays off the loan early, he or she will not be entitled to a refund any part of the finance charge. What does this mean?
This means the Borrower will be charged interest for the period of time in which they used the borrowed money. A prepaid finance charge is generally not refundable, nor is any interest, which has already been paid. However, if the loan is paid off early the Borrower will not pay the full amount of the Finance Charge shown on the disclosure because they will only pay accrued interest through the date of the payoff.
Related Questions
- The TRUTH IN LENDING ACT (TILA) Disclosure says that if the Borrower pays off the loan early, he or she will not be entitled to a refund any part of the finance charge. What does this mean?
- Did the Lender violate the disclosure provisions of the Federal Truth in Lending Act?
- How Can The Truth in Lending Act (TILA) Affect My Commercial Loan Modification?
