What is the primary focus of the Truth in Lending Act (TILA) in mortgage lending?

The primary focus of the Truth in Lending Act (TILA) is to ensure transparency about loan terms and costs. TILA was enacted to promote informed consumer credit decisions by requiring clear disclosure of the terms of lending, including the annual percentage rate (APR), finance charges, and total costs of credit. This enables borrowers to understand the true cost of their loans, allowing them to compare different mortgage offers effectively. By mandating these disclosures, TILA seeks to eliminate misleading advertising and enhance borrowers' ability to protect themselves against deceptive practices in lending.

As a result, the act plays a crucial role in fostering a fair and informed marketplace, ultimately empowering consumers in their financial decisions related to mortgage lending.