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15 U.S.C. § 1605 — Determination of finance charge
Federal law — U.S. Code and appendices · legal_authorities
**(a) “Finance charge” defined** Except as otherwise provided in this section, the amount of the finance charge in connection with any consumer credit transaction shall be determined as the sum of all charges, payable directly or indirectly by the person to whom the credit is extended, and imposed directly or indirectly by the creditor as an incident to the extension of credit. The finance charge does not include charges of a type payable in a comparable cash transaction. The finance charge shall not include fees and amounts imposed by third party closing agents (including settlement agents, attorneys, and escrow and title companies) if the creditor does not require the imposition of the charges or the services provided and does not retain the charges. Examples of charges which are included in the finance charge include any of the following types of charges which are applicable:
(1) Interest, time price differential, and any amount payable under a point, discount, or other system or additional charges.
(2) Service or carrying charge.
(3) Loan fee, finder’s fee, or similar charge.
(4) Fee for an investigation or credit report.
(5) Premium or other charge for any guarantee or insurance protecting the creditor against the obligor’s default or other credit loss.
(6) Borrower-paid mortgage broker fees, including fees paid directly to the broker or the lender (for delivery to the broker) whether such fees are paid in cash or financed.
**(b) Life, accident, or health insurance premiums included in finance charge** Charges or premiums for credit life, accident, or health insurance written in connection with any consumer credit transaction shall be included in the finance charges unless
(1) the coverage of the debtor by the insurance is not a factor in the approval by th
Source: Supplied U.S. Code snapshot — release unconfirmed · 15 U.S.C. § 1605
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Source file: Laws/federal/codes/united-states-code/title-15/section-1605-determination-of-finance-charge--c744c9fad7.md
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Source location: Title 15, Chapter 41, § 1605; chapter-041-consumer-credit-protection.md
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**(a) “Finance charge” defined** Except as otherwise provided in this section, the amount of the finance charge in connection with any consumer credit transaction shall be determined as the sum of all charges, payable directly or indirectly by the person to whom the credit is extended, and imposed directly or indirectly by the creditor as an incident to the extension of credit. The finance charge does not include charges of a type payable in a comparable cash transaction. The finance charge shall not include fees and amounts imposed by third party closing agents (including settlement agents, attorneys, and escrow and title companies) if the creditor does not require the imposition of the charges or the services provided and does not retain the charges. Examples of charges which are included in the finance charge include any of the following types of charges which are applicable:
(1) Interest, time price differential, and any amount payable under a point, discount, or other system or additional charges.
(2) Service or carrying charge.
(3) Loan fee, finder’s fee, or similar charge.
(4) Fee for an investigation or credit report.
(5) Premium or other charge for any guarantee or insurance protecting the creditor against the obligor’s default or other credit loss.
(6) Borrower-paid mortgage broker fees, including fees paid directly to the broker or the lender (for delivery to the broker) whether such fees are paid in cash or financed.
**(b) Life, accident, or health insurance premiums included in finance charge** Charges or premiums for credit life, accident, or health insurance written in connection with any consumer credit transaction shall be included in the finance charges unless
(1) the coverage of the debtor by the insurance is not a factor in the approval by the creditor of the extension of credit, and this fact is clearly disclosed in writing to the person applying for or obtaining the extension of credit; and
(2) in order to obtain the insurance in connection with the extension of credit, the person to whom the credit is extended must give specific affirmative written indication of his desire to do so after written disclosure to him of the cost thereof.
**(c) Property damage and liability insurance premiums included in finance charge** Charges or premiums for insurance, written in connection with any consumer credit transaction, against loss of or damage to property or against liability arising out of the ownership or use of property, shall be included in the finance charge unless a clear and specific statement in writing is furnished by the creditor to the person to whom the credit is extended, setting forth the cost of the insurance if obtained from or through the creditor, and stating that the person to whom the credit is extended may choose the person through which the insurance is to be obtained.
**(d) Items exempted from computation of finance charge in all credit transactions** If any of the following items is itemized and disclosed in accordance with the regulations of the Bureau in connection with any transaction, then the creditor need not include that item in the computation of the finance charge with respect to that transaction:
(1) Fees and charges prescribed by law which actually are or will be paid to public officials for determining the existence of or for perfecting or releasing or satisfying any security related to the credit transaction.
(2) The premium payable for any insurance in lieu of perfecting any security interest otherwise required by the creditor in connection with the transaction, if the premium does not exceed the fees and charges described in paragraph (1) which would otherwise be payable.
(3) Any tax levied on security instruments or on documents evidencing indebtedness if the payment of such taxes is a precondition for recording the instrument securing the evidence of indebtedness.
**(e) Items exempted from computation of finance charge in extensions of credit secured by an interest in real property** The following items, when charged in connection with any extension of credit secured by an interest in real property, shall not be included in the computation of the finance charge with respect to that transaction:
(1) Fees or premiums for title examination, title insurance, or similar purposes.
(2) Fees for preparation of loan-related documents.
(3) Escrows for future payments of taxes and insurance.
(4) Fees for notarizing deeds and other documents.
(5) Appraisal fees, including fees related to any pest infestation or flood hazard inspections conducted prior to closing.
(6) Credit reports.
**(f) Tolerances for accuracy** In connection with credit transactions not under an open end credit plan that are secured by real property or a dwelling, the disclosure of the finance charge and other disclosures affected by any finance charge—
(1) shall be treated as being accurate for purposes of this subchapter if the amount disclosed as the finance charge—
(A) does not vary from the actual finance charge by more than $100; or
(B) is greater than the amount required to be disclosed under this subchapter; and
(2) shall be treated as being accurate for purposes of [section 1635 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title15-section1635&num=0&edition=prelim) if—
(A) except as provided in subparagraph (B), the amount disclosed as the finance charge does not vary from the actual finance charge by more than an amount equal to one-half of one percent of the total amount of credit extended; or
(B) in the case of a transaction, other than a mortgage referred to in section 1602(aa) 11 See References in Text note below. of this title, which—
(i) is a refinancing of the principal balance then due and any accrued and unpaid finance charges of a residential mortgage transaction as defined in section 1602(w) 1 of this title, or is any subsequent refinancing of such a transaction; and
(ii) does not provide any new consolidation or new advance;
if the amount disclosed as the finance charge does not vary from the actual finance charge by more than an amount equal to one percent of the total amount of credit extended.
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Federal law — U.S. Code and appendices · legal_authorities
**(a)** The definitions and rules of construction set forth in this section are applicable for the purposes of this subchapter.
**(b) Bureau.—** The term “Bureau” means the Bureau of Consumer Financial Protection.
**(c)** The term “Board” refers to the Board of Governors of the Federal Reserve System.
**(d)** The term “organization” means a corporation, government or governmental subdivision or agency, trust, estate, partnership, cooperative, or association.
**(e)** The term “person” means a natural person or an organization.
**(f)** The term “credit” means the right granted by a creditor to a debtor to defer payment of debt or to incur debt and defer its payment.
**(g)** The term “creditor” refers only to a person who both (1) regularly extends, whether in connection with loans, sales of property or services, or otherwise, consumer credit which is payable by agreement in more than four installments or for which the payment of a finance charge is or may be required, and (2) is the person to whom the debt arising from the consumer credit transaction is initially payable on the face of the evidence of indebtedness or, if there is no such evidence of indebtedness, by agreement. Notwithstanding the preceding sentence, in the case of an open-end credit plan involving a credit card, the card issuer and any person who honors the credit card and offers a discount which is a finance charge are creditors. For the purpose of the requirements imposed under part D of this subchapter and sections 1637(a)(5), 1637(a)(6), 1637(a)(7), 1637(b)(1), 1637(b)(2), 1637(b)(3), 1637(b)(8), and 1637(b)(10) of this title, the term “creditor” shall also include card issuers whether or not the amount due is payable by agreement in more than four installments or the payment of a finance charge
Source: Supplied U.S. Code snapshot — release unconfirmed · 15 U.S.C. § 1602
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Definitions.—** For purposes of this section—
(1) the term “agency” means agency as defined in section 552(e) 11 See References in Text note below. of this title;
(2) the term “individual” means a citizen of the United States or an alien lawfully admitted for permanent residence;
(3) the term “maintain” includes maintain, collect, use, or disseminate;
(4) the term “record” means any item, collection, or grouping of information about an individual that is maintained by an agency, including, but not limited to, his education, financial transactions, medical history, and criminal or employment history and that contains his name, or the identifying number, symbol, or other identifying particular assigned to the individual, such as a finger or voice print or a photograph;
(5) the term “system of records” means a group of any records under the control of any agency from which information is retrieved by the name of the individual or by some identifying number, symbol, or other identifying particular assigned to the individual;
(6) the term “statistical record” means a record in a system of records maintained for statistical research or reporting purposes only and not used in whole or in part in making any determination about an identifiable individual, except as provided by [section 8 of title 13](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title13-section8&num=0&edition=prelim);
(7) the term “routine use” means, with respect to the disclosure of a record, the use of such record for a purpose which is compatible with the purpose for which it was collected;
(8) the term “matching program”—
(A) means any computerized comparison of—
(i) two or more automated systems of records or a system of records with non-Federal records for the purpose
Source: Supplied U.S. Code snapshot — release unconfirmed · 5 U.S.C. § 552a
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Disclosure of obligor’s right to rescind** Except as otherwise provided in this section, in the case of any consumer credit transaction (including opening or increasing the credit limit for an open end credit plan) in which a security interest, including any such interest arising by operation of law, is or will be retained or acquired in any property which is used as the principal dwelling of the person to whom credit is extended, the obligor shall have the right to rescind the transaction until midnight of the third business day following the consummation of the transaction or the delivery of the information and rescission forms required under this section together with a statement containing the material disclosures required under this subchapter, whichever is later, by notifying the creditor, in accordance with regulations of the Bureau, of his intention to do so. The creditor shall clearly and conspicuously disclose, in accordance with regulations of the Bureau, to any obligor in a transaction subject to this section the rights of the obligor under this section. The creditor shall also provide, in accordance with regulations of the Bureau, appropriate forms for the obligor to exercise his right to rescind any transaction subject to this section.
**(b) Return of money or property following rescission** When an obligor exercises his right to rescind under subsection (a), he is not liable for any finance or other charge, and any security interest given by the obligor, including any such interest arising by operation of law, becomes void upon such a rescission. Within 20 days after receipt of a notice of rescission, the creditor shall return to the obligor any money or property given as earnest money, downpayment, or otherwise, and shall take any action necessary
Source: Supplied U.S. Code snapshot — release unconfirmed · 15 U.S.C. § 1635
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Informed use of credit** The Congress finds that economic stabilization would be enhanced and the competition among the various financial institutions and other firms engaged in the extension of consumer credit would be strengthened by the informed use of credit. The informed use of credit results from an awareness of the cost thereof by consumers. It is the purpose of this subchapter to assure a meaningful disclosure of credit terms so that the consumer will be able to compare more readily the various credit terms available to him and avoid the uninformed use of credit, and to protect the consumer against inaccurate and unfair credit billing and credit card practices.
**(b) Terms of personal property leases** The Congress also finds that there has been a recent trend toward leasing automobiles and other durable goods for consumer use as an alternative to installment credit sales and that these leases have been offered without adequate cost disclosures. It is the purpose of this subchapter to assure a meaningful disclosure of the terms of leases of personal property for personal, family, or household purposes so as to enable the lessee to compare more readily the various lease terms available to him, limit balloon payments in consumer leasing, enable comparison of lease terms with credit terms where appropriate, and to assure meaningful and accurate disclosures of lease terms in advertisements.
Source: Supplied U.S. Code snapshot — release unconfirmed · 15 U.S.C. § 1601
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Required disclosures by creditor** For each consumer credit transaction other than under an open end credit plan, the creditor shall disclose each of the following items, to the extent applicable:
(1) The identity of the creditor required to make disclosure.
(2)
(A) The “amount financed”, using that term, which shall be the amount of credit of which the consumer has actual use. This amount shall be computed as follows, but the computations need not be disclosed and shall not be disclosed with the disclosures conspicuously segregated in accordance with subsection (b)(1):
(i) take the principal amount of the loan or the cash price less downpayment and trade-in;
(ii) add any charges which are not part of the finance charge or of the principal amount of the loan and which are financed by the consumer, including the cost of any items excluded from the finance charge pursuant to [section 1605 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title15-section1605&num=0&edition=prelim); and
(iii) subtract any charges which are part of the finance charge but which will be paid by the consumer before or at the time of the consummation of the transaction, or have been withheld from the proceeds of the credit.
(B) In conjunction with the disclosure of the amount financed, a creditor shall provide a statement of the consumer’s right to obtain, upon a written request, a written itemization of the amount financed. The statement shall include spaces for a “yes” and “no” indication to be initialed by the consumer to indicate whether the consumer wants a written itemization of the amount financed. Upon receiving an affirmative indication, the creditor shall provide, at the time other disclosures are required to be furnished, a written
Source: Supplied U.S. Code snapshot — release unconfirmed · 15 U.S.C. § 1638
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Cash discounts** With respect to credit 11 So in original. Probably should be preceded by “a”. card which may be used for extensions of credit in sales transactions in which the seller is a person other than the card issuer, the card issuer may not, by contract or otherwise, prohibit any such seller from offering a discount to a cardholder to induce the cardholder to pay by cash, check, or similar means rather than use a credit card.
**(b) Finance charge** With respect to any sales transaction, any discount from the regular price offered by the seller for the purpose of inducing payment by cash, checks, or other means not involving the use of an open-end credit plan or a credit card shall not constitute a finance charge as determined under [section 1605 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title15-section1605&num=0&edition=prelim) if such discount is offered to all prospective buyers and its availability is disclosed clearly and conspicuously.
Source: Supplied U.S. Code snapshot — release unconfirmed · 15 U.S.C. § 1666f
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Federal law — U.S. Code and appendices · legal_authorities
Page 1465
TITLE 15—COMMERCE AND TRADE
§ 1605
Statutory Notes and Related Subsidiaries
EFFECTIVE DATE OF 2010 AMENDMENT
Amendment by section 1100A(2), (4)–(7) of Pub. L.
111–203 effective on the designated transfer date, see
section 1100H of Pub. L. 111–203, set out as a note under
section 552a of Title 5, Government Organization and
Employees.
Amendment by section 1472(c) of Pub. L. 111–203 effec-
tive on the date on which final regulations imple-
menting that amendment take effect, or on the date
that is 18 months after the designated transfer date if
such regulations have not been issued by that date, see
section 1400(c) of Pub. L. 111–203, set out as a note under
section 1601 of this title.
EFFECTIVE DATE OF 1980 AMENDMENT
Amendment by Pub. L. 96–221 effective on expiration
of two years and six months after Mar. 31, 1980, with all
regulations, forms, and clauses required to be pre-
scribed to be promulgated at least one year prior to
such effective date, and allowing any creditor to com-
ply with any amendments, in accordance with the regu-
lations, forms, and clauses prescribed by the Board
prior to such effective date, see section 625 of Pub. L.
96–221, set out as a note under section 1602 of this title.
§ 1605. Determination of finance charge
(a) ‘‘Finance charge’’ defined
Except as otherwise provided in this section,
the amount of the finance charge in connection
with any consumer credit transaction shall be
determined as the sum of all charges, payable
directly or indirectly by the person to whom the
credit is extended, and imposed directly or indi-
rectly by the creditor as an incident to the ex-
tension of credit. The finance charge does not
include charges of a type payable in a com-
parable cash transaction. The finance charge
sha
Source: Supplied 2024 U.S. Code historical extraction · 15 U.S.C. § 1605
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