The Truth in Lending Act (TILA) was established in 1968, with the purpose of regulating the credit market and providing ample disclose so that consumers can make informed borrowing choices.
TILA helps consumers to understand the risks which they will take when they borrow money, particularly when the loan is for a large amount and tied to real property as collateral (for example real estate).
The Truth in Lending Act also stipulates what information a lender must provide to you on paper when you sign up for a loan.
How does this apply to mortgages? A mortgage typically represents a home loan which is in a concrete sense tied to your home since the home is collateral. Even though you used the mortgage to purchase your home, your home is forfeit if you cannot pay back your mortgage.
The Truth in Lending Act sets concrete restrictions, including a maximum interest rate, on some types of home loans. TILA was created to assist the borrower, not the lender, so you may be able to make use of it in your case if you want to get your interest rate lowered.
If you can prove that your lender is violating TILA with the interest rate on your mortgage, you can probably get it reduced and maybe even keep your home.
Just don’t forget that TILA doesn’t apply to all home loans. If you are in doubt about your situation, seek legal advice on whether the Truth in Lending Act can help you or not.