MORNBFI Vol. 1 - Planters Development Bank

ABSTRACT OF "TRUTH IN LENDING ACT" (Republic Act No. 3765)[Appendix to Subsec. 4307Q.4 (2008 - 4309Q.4)]APP. Q-1208.12.31Section 1. This Act shall be known as the"Truth in Lending Act."Sec. 2. Declaration of Policy. It ishereby declared to be the policy of theState to protect its citizens from a lack ofawareness of the true cost of credit to theuser by assuring a full disclosure of suchcost with a view of preventing theuninformed use of credit to the detrimentof the national economy.xxxx xxxx xxxxSec. 3. As used in this Act, the term -xxxx xxxx xxxx(3) "Finance charge" includesinterest, fees, service charges, discounts,and such other charges incident to theextension of credit as the Board may byregulation prescribe.xxxx xxxx xxxxSec. 4. Any creditor shall furnish to eachperson to whom credit is extended, priorto the consummation of the transaction, aclear statement in writing setting forth, tothe extent applicable and in accordancewith rules and regulations prescribed bythe Board, the following information:(1) the cash price or delivered priceof the property or service to be acquired;(2) the amounts, if any, to be creditedas down payment and/or trade-in;(3) the difference between theamounts set forth under clauses (1) and(2);(4) the charges, individuallyitemized, which are paid or to be paidby such person in connection with thetransaction but which are not incident tothe extension of credit;(5) the total amount to be financed;(6) the finance charge expressed interms of pesos and centavos; and(7) the percentage that the financecharge bears to the total amount to befinanced expressed as a simple annual rateon the outstanding unpaid balance of theobligation.xxxx xxxx xxxxSec. 6. (a) Any creditor who inconnection with any credit transaction failsto disclose to any person any informationin violation of this Act or any regulationissued thereunder shall be liable to suchperson in the amount of P100 or in anamount equal to twice the finance chargerequired by such creditor in connectionwith such transaction, whichever is thegreater, except that such liability shall notexceed P2,000 on any credit transaction.xxxx xxxx xxxx(c) Any person who willfully violatesany provision of this Act or any regulationissued thereunder shall be fined by not lessthan P1,000 nor more than P5,000 orimprisonment for not less than 6 monthsnor more than one year or both.xxxx xxxx xxxx(d) Any final judgment hereafterrendered in any criminal proceeding underthis Act to the effect that a defendant haswillfully violated this Act shall be primafacie evidence against such defendant inan action or proceeding brought by anyother party against such defendant underthis Act as to all matters respecting whichsaid judgment would be an estoppel asbetween the parties thereto.Sec. 7. This Act shall become effectiveupon approval.Approved, 22 June 1963.Manual of Regulations for Non-Bank Financial InstitutionsQ RegulationsAppendix Q-12 - Page 1