Which law is designed to ensure transparency and honesty in lending?

The Truth in Lending Act (TILA) is the law specifically designed to promote transparency and honesty in lending practices. It mandates that lenders provide clear and concise information about the terms and costs associated with borrowing. This includes disclosing the annual percentage rate (APR), finance charges, and the total costs of the loan. By ensuring that borrowers have access to this critical information, TILA enables them to make informed decisions, compare different loan offers, and understand their financial obligations.

While other laws, such as the Fair Housing Act and the Equal Credit Opportunity Act, play vital roles in promoting fair treatment in housing and lending, they do not specifically focus on the clarity and honesty of the lending process in the same way that TILA does. The Home Mortgage Disclosure Act is also important for ensuring transparency, but its primary focus is on the collection and reporting of mortgage data to monitor lending patterns, rather than detailing loan costs and terms to consumers directly.