When must lenders provide Regulation Z disclosures?

Lenders must provide Regulation Z disclosures before the loan documents are executed or the first transaction occurs in open-end transactions. This requirement is crucial because it ensures that consumers have the necessary information about the costs and terms associated with the credit they are applying for before they are committed to the loan agreement. By receiving these disclosures beforehand, borrowers can make informed decisions, compare options, and potentially avoid unfavorable financial obligations.

The timeline for delivering these disclosures is governed by the Truth in Lending Act (TILA), which emphasizes transparency and consumer protection in lending practices. It is specifically designed to ensure that the borrower understands the terms of the credit being offered, including the annual percentage rate (APR), finance charges, and other key details.

Proper timing of these disclosures is essential for maintaining compliance with Regulation Z, and it helps in fostering trust and clarity between the lender and borrower right from the beginning of the lending process.