12 U.S.C. § 5532: Disclosures

Summary

The Bureau can make rules so people get clear, accurate, and useful information about consumer financial products and services at the start and during the life of the product. Rules can include optional model forms that companies may use. Any model form must use plain language, have a clear layout and readable type, briefly explain the key facts, and be checked by real consumers through testing. The Bureau must base rules on evidence about how well consumers notice and understand disclosures. If a company uses a Bureau model form, it is treated as meeting the disclosure rules. The Bureau can allow limited trial programs to test better disclosures, and it can give temporary compliance relief for those trials and make information about the trials public as needed. Not later than 1 year after the designated transfer date, the Bureau must propose rules and model forms that combine the disclosures required under the Truth in Lending Act and sections 2603 and 2604 into a single mortgage disclosure, unless an equivalent proposal from the Board and HUD already does that.

Title 12, §5532

Banks and Banking, Source: USLM XML via OLRC

(a)In general

The Bureau may prescribe rules to ensure that the features of any consumer financial product or service, both initially and over the term of the product or service, are fully, accurately, and effectively disclosed to consumers in a manner that permits consumers to understand the costs, benefits, and risks associated with the product or service, in light of the facts and circumstances.

(b)Model disclosures

(1)In general

Any final rule prescribed by the Bureau under this section requiring disclosures may include a model form that may be used at the option of the covered person for provision of the required disclosures.

(2)Format

A model form issued pursuant to paragraph (1) shall contain a clear and conspicuous disclosure that, at a minimum—

(A)uses plain language comprehensible to consumers;

(B)contains a clear format and design, such as an easily readable type font; and

(C)succinctly explains the information that must be communicated to the consumer.

(3)Consumer testing

Any model form issued pursuant to this subsection shall be validated through consumer testing.

(c)Basis for rulemaking

In prescribing rules under this section, the Bureau shall consider available evidence about consumer awareness, understanding of, and responses to disclosures or communications about the risks, costs, and benefits of consumer financial products or services.

(d)Safe harbor (e) Trial disclosure programs

Any covered person that uses a model form included with a rule issued under this section shall be deemed to be in compliance with the disclosure requirements of this section with respect to such model form.

(f)Combined mortgage loan disclosure

Not later than 1 year after the designated transfer date, the Bureau shall propose for public comment rules and model disclosures that combine the disclosures required under the Truth in Lending Act [15 U.S.C. 1601 et seq.] and section 2603 and 2604 of this title, into a single, integrated disclosure for mortgage loan transactions covered by those laws, unless the Bureau determines that any proposal issued by the Board of Governors and the Secretary of Housing and Urban Development carries out the same purpose.

Notes & Related Subsidiaries

Editorial Notes

References in Text

The Truth in Lending Act, referred to in subsec. (f), is title I of Pub. L. 90–321, May 29, 1968, 82 Stat. 146, which is classified generally to subchapter I (§ 1601 et seq.) of chapter 41 of Title 15, Commerce and Trade. For complete classification of this Act to the Code, see

Short Title

note set out under section 1601 of Title 15 and Tables.

Statutory Notes and Related Subsidiaries

Effective Date

Section effective on the designated transfer date, see section 1037 of Pub. L. 111–203, set out as a note under section 5531 of this title.

§5532 Disclosures