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Truth & Lending - Open-ended credit defined


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Posted by JR (205.188.209.12) on October 25, 2002 at 04:31:14:

In Reply to: Truth and Lending Statement posted by Mickey on October 24, 2002 at 22:11:54:

Congress amended the definition of open-end credit as part of the Truth in Lending Simplification Act of 1980, adding the requirement that "the creditor reasonably contemplates repeated transactions." 15 U.S.C Section 1602(i).

In summary, the statute defines open-end credit in Regulation Z, Section 226.2(a)(20) as follows: A consumer credit extended by a creditor under a plan in which -

(i) The creditor reasonably contemplates repeated transactions;
(ii) The creditor may impose a finance charge from time to time on an outstanding unpaid balance; and

(iii) The amount of credit that may be extended to the consumer during the term of the plan (up to any limit set by the creditor) is generally made available to the extent that any outstanding balance is repaid.

This should be al that you need.


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