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TILA Disclosure Statement

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TILA DISCLOSURE STATEMENT

This TILA Disclosure Statement (the Statement) is made between Creditor Name: with principal mailing address: and Borrower Name: whose address is: .

RECITALS

WHEREAS, Creditor has offered to extend consumer credit to Borrower in connection with the loan described herein; and

WHEREAS, Borrower seeks to obtain such credit and has requested written disclosures of the finance charge, annual percentage rate (APR), amount financed, and total payments in accordance with the Truth in Lending Act and implementing regulation requiring clear disclosure of credit terms to consumers; and

WHEREAS, the parties desire to memorialize the material terms of the credit transaction by providing the disclosures set forth below.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties agree as follows:

1. CREDIT TERMS

Creditor agrees to extend credit to Borrower on the following material terms. Loan Type:

Principal Amount (Loan Amount): $

2. ANNUAL PERCENTAGE RATE (APR)

The finance charge expressed as an annual percentage rate: APR: (the APR includes interest and other finance charges required to be disclosed under applicable consumer credit law).

3. FINANCE CHARGE

The finance charge is the dollar amount the credit will cost you. Finance Charge: $

4. AMOUNT FINANCED AND TOTAL OF PAYMENTS

Amount Financed (the amount of credit provided to you): $

Total of Payments (total amount you will have paid after last scheduled payment): $

5. PAYMENT SCHEDULE

Number of Payments: Payment Amount: $ Payment Frequency:

First Payment Due Date: Maturity Date:

6. PREPAYMENT

Borrower may prepay all or any principal at any time in whole or in part without penalty except as provided below. Prepayment Penalty Applicable: Yes No

7. LATE CHARGES

If a payment is more than days late, a late charge may be imposed in the amount of $ or of the missed payment, whichever is less.

8. SECURITY INTEREST

This loan is secured: Yes No

9. RIGHT TO RESCIND

If this transaction is for the extension of credit that is secured by the consumer's principal dwelling, the Borrower has the right to rescind the transaction as provided by law. The right to rescind expires three business days after the latest of: (a) the date of consummation of the transaction, (b) the date the Borrower receives the required notice of the right to rescind, or (c) the date the Borrower receives all material disclosures. Rescission Deadline:

To exercise the right to rescind, the Borrower must notify the Creditor in writing of the intention to rescind and deliver such notice to Creditor at Creditor Address:

10. PAYMENTS AND APPLICATION

Payments received will be applied in the order required by law. If applicable, any payments in excess of amounts due may be applied to principal first, unless otherwise agreed in writing. Borrower agrees that Creditor may accept partial payments without waiver of rights under this Statement.

11. DEFAULT

Borrower will be in default if Borrower fails to make any required payment when due or otherwise breaches any material obligation under the loan documents. Upon default, Creditor may exercise all rights and remedies provided by the loan documents and applicable law, including acceleration of the balance and repossession or foreclosure of secured collateral.

12. NOTICES

Any notice required or permitted under this Statement shall be in writing and shall be deemed given when delivered in person, when sent by certified mail (return receipt requested), or when sent by nationally recognized overnight courier, to the addresses set forth above or such other address as either party designates in writing.

13. GOVERNING LAW

This Statement and any claim, controversy or dispute arising under or related to it shall be governed by and construed in accordance with the laws of the State of , without giving effect to conflict of law principles that would apply the law of another jurisdiction.

14. ENTIRE AGREEMENT

This Statement, together with any promissory note, security instrument, or other written agreements executed by the parties in connection with the transaction, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral or written.

15. SEVERABILITY

If any provision of this Statement is held invalid, illegal, or unenforceable in whole or in part, the remaining provisions shall remain in full force and effect to the fullest extent permitted by law.

16. AMENDMENT AND WAIVER

No amendment, modification, or waiver of any provision of this Statement shall be effective unless in writing and signed by both parties. The failure of either party to enforce any right or provision shall not constitute a waiver of such right or provision.

17. COUNTERPARTS

This Statement may be executed in counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Signatures delivered by electronic means shall be treated as original signatures for all purposes.

18. CERTIFICATION

By signing below, Borrower and Creditor each acknowledge receipt of a copy of this TILA Disclosure Statement, certify that the disclosures contained herein were provided prior to consummation of the transaction to the extent required by law, and represent that the information set forth is true and correct to the best of their knowledge.

Creditor

Printed Name:

By:

Date:

Borrower

Printed Name:

By:

Date:

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What the TILA Disclosure Statement Is and when it applies

A TILA Disclosure Statement is a consumer-facing disclosure required under the Truth in Lending Act (TILA, 15 U.S.C. §1601 et seq.) and implementing Regulation Z (12 C.F.R. Part 1026). It summarizes the cost of credit, including the annual percentage rate (APR), finance charge, amount financed, total payments, and payment schedule. The statement helps borrowers compare credit offers, verify loan terms before signing, and evaluate costs such as fees and interest. Lenders provide TILA disclosures for consumer credit products covered by TILA, and the form often appears alongside or as part of other closing documents for secured consumer loans.

Why the TILA Disclosure Statement matters for lenders and borrowers

The TILA Disclosure Statement creates clear, standardized disclosure of credit costs required by federal law, reducing disputes and enabling regulators and consumers to assess compliance.

Why the TILA Disclosure Statement matters for lenders and borrowers

Who typically prepares and receives the TILA Disclosure Statement

Typical users include consumer lenders, mortgage brokers, loan processors, closing agents, and borrowers; attorneys and compliance officers review disclosures for regulatory accuracy.

  • Lenders and banks prepare disclosures to show APR, finance charge, and payment schedule to prospective borrowers.
  • Mortgage brokers and servicers provide disclosures tied to mortgage closings and loan modifications.
  • Borrowers and co-borrowers receive and review the disclosure before consummation or closing.

Proper preparation and timely delivery protect both parties and help satisfy TILA/Regulation Z timing and content requirements.

Step-by-step: completing the TILA Disclosure Statement accurately

Follow these steps in order to prepare and deliver a compliant TILA Disclosure Statement to a consumer.

  • 01
    Collect information: Gather loan terms, fees, payment schedule and borrower identity details.
  • 02
    Calculate APR: Use approved APR formulas consistent with Regulation Z guidance.
  • 03
    Populate form: Enter numeric values, dates, and creditor details in the specified fields.
  • 04
    Deliver: Provide the disclosure to the consumer within required timing rules.

Core elements every professional TILA Disclosure Statement should include

A compliant disclosure contains specific numeric and narrative elements so borrowers can compare costs and lenders can demonstrate compliance with TILA and Reg Z.

Annual Percentage Rate

A clear APR statement expressed as a percentage with standard rounding. APR must be calculated according to Regulation Z and presented prominently to allow consumer comparison across offers.

Finance Charge

The total dollar amount the consumer will pay in interest and certain fees. This should match the lender's internal calculation and be itemized where required to avoid disclosure errors.

Amount Financed

The principal amount provided to the borrower less any prepaid finance charges. This field determines repayment obligations and must reflect the net proceeds accurately.

Total of Payments

The cumulative total of all scheduled payments over the loan term. Reconcile this value with the payment schedule and APR calculations before delivery.

Payment Schedule

List periodic payment amounts, number and frequency. Include first payment date, periodic payment, and balloon payments if any, so consumers see timing and amount of obligations.

Rescission and Notices

State whether the loan is covered by the lender's right-of-rescission rules and provide required rescission timing language when applicable, including how and when to exercise the right.

Security, privacy, and compliance items to include with disclosures

Encryption: TLS 1.2/1.3 in transit; AES-256 at rest
Audit trail: Timestamp, IP, signer actions retained
Access controls: Authenticated user access and role separation
HIPAA BAA: Required for PHI; sign a BAA
ESIGN / UETA: Legal framework for e-signature validity
SOC 2 / ISO: Third-party certifications available

Potential penalties and risks from incorrect or late TILA disclosures

Rescission exposure: Borrower may rescind certain transactions
Civil liability: Statutory damages and attorney fees possible
Regulatory fines: Enforcement actions by CFPB or state agencies
Contract disputes: Inaccurate terms can void provisions
Reputational harm: Consumer complaints and sanctions
Operational delays: Closings may be postponed for corrections

Common mistakes when preparing a TILA Disclosure Statement

  • Using inconsistent APR calculations across documents leading to buyer confusion and compliance issues.
  • Failing to include mandatory itemized fees, which can trigger rescission or enforcement risk.
  • Delivering disclosures outside required timing windows, causing closing delays or statutory remedies.
  • Mismatched borrower names or incorrect loan amounts that complicate servicing and collections.

Key timing requirements for delivering TILA disclosures

TILA and Regulation Z set timing rules for disclosures; specific deadlines depend on the credit type and whether TRID applies (Reg Z, 12 C.F.R. Part 1026).

Initial disclosure timing:

Provide required disclosures within three business days after application (15 U.S.C. §1638; Reg Z).

Loan Estimate timing:

For TRID-covered mortgage loans, a Loan Estimate is given within three business days of application.

Closing Disclosure timing:

For TRID-covered loans, provide the Closing Disclosure at least three business days before consummation.

Rescission period:

Right to rescind commonly runs three business days after delivery for covered transactions (15 U.S.C. §1635).

Record retention:

Retain evidence of delivery and consent per retention rules and supervisory expectations.

How to configure an online TILA disclosure workflow

Set up e-delivery, consent capture, and field mapping so disclosures meet ESIGN, Reg Z, and internal audit requirements.

Field Configuration
Authentication Email link or SMS code; consider stronger ID for high-risk loans
Consent capture Present ESIGN consumer disclosure and record affirmative consent
Template mapping Map APR, finance charge, and payment fields to form template
Audit trail Enable timestamping, IP logging, and signed certificate storage

Technical requirements for digital signing and e-submission

Use a platform that supports secure delivery, durable audit trails, and consumer consent capture consistent with ESIGN/UETA.

  • Integrations: Salesforce, Microsoft 365, NetSuite, Google Workspace
  • Document formats: PDF, DOCX, HTML, Excel
  • Authentication options: Email, SMS, KBA, advanced signer auth

Ensure the platform provides retention of signed records and exportable audit certificates to meet regulatory review and litigation needs.

Where and how to send the TILA Disclosure Statement

Routing and delivery depend on whether the loan is in-person or digital; follow this sequence to deliver and document disclosures.

  • Upload: Upload the completed disclosure into the signing platform
  • Place fields: Map signature, date, and initial fields for each borrower
  • Send to borrower: Deliver via secure email link or in-person signing
  • Store record: Save signed PDF and audit trail in document repository

How a TILA Disclosure Statement differs from other consumer credit documents

Compare common document types so you choose the right disclosure or form depending on transaction scope and regulatory requirements.

Criteria TILA Disclosure Loan Estimate (TRID)
Applicability most consumer loans closed-end mortgage loans
Timing within 3 business days loan estimate within 3 business days
Rescission applies to some transactions rescission rules per regulation
Format numeric summary standardized trid form

eSignature vendor comparison relevant to TILA Disclosure use

Platform choice affects cost, compliance features, and volume handling. The table below summarizes starting prices, trial availability, bulk send, audit trail, HIPAA compliance, and envelope limits for common eSignature vendors. Do not rely on this table as the sole procurement input; verify plan specifics with each vendor.

signNow DocuSign Adobe Sign PandaDoc HelloSign
Starting Price $8/user/mo $15/user/mo $14/user/mo $19/user/mo $15/user/mo
Free Trial 7-day free trial Varies by plan Varies by plan Varies by plan Varies by plan
Bulk Send Yes Yes Yes Yes No
Audit Trail Yes Yes Yes Yes Yes
HIPAA Compliant Yes Yes Yes No No

Real-world examples of using online signatures for TILA disclosures

These examples show how firms adapted disclosure workflows to digital delivery and tracked compliance in high-volume environments.

Martin Properties — Real estate closings

Martin Properties moved disclosures online to streamline closings and reduce in-person steps.

  • They used mobile signing for borrower convenience.
  • The team retained complete signed records and audit trails to demonstrate timely delivery and reduce post-closing disputes.

Optica Ventures — Consumer loan processing

Optica integrated electronic disclosures into its loan origination process to centralize records and reduce manual entry.

  • Automation ensured APR and finance charge fields matched lending calculations.
  • Centralized storage with exportable certificates simplified audit response and compliance reporting.

Frequently asked questions about the TILA Disclosure Statement

Answers to common questions about timing, electronic delivery, rescission, and recordkeeping for TILA disclosures.


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