Consumer Credit Protection Act

1968 federal legislation that makes it mandatory for lenders to disclose to credit applicants the annual interest percentage rate (APR) and any finance charge.

A federal statute designed to protect borrowers of money by mandating complete disclosure of the terms and conditions of finance charges in transactions by limiting the garnishment of wages and by regulating the use of charge accounts.

The Consumer Credit Protection Act (15 U.S.C.A. § 1601 et seq. [1972]) was the first general federal consumer protection legislation. Title I of this law, known as the Truth-in-Lending Act (15 U.S.C.A. § 1601 et seq. [1968]), requires that the terms in consumer credit transactions be fully explained to the prospective debtors. Title VI of the Consumer Credit Protection Act, known as the Fair Credit Reporting Act (15 U.S.C.A. § 1601 et seq. [1978]), applies to businesses that regularly obtain consumer credit information for other businesses. Its purpose is to ensure that consumer reporting activities are conducted in a manner that is fair and equitable to the affected consumer.

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