TRUTH IN LENDING ACT (RA 3765) Flashcards
In one sentence describe RA 3765.
AN ACT TO REQUIRE THE DISCLOSURE OF FINANCE CHARGES IN CONNECTION WITH EXTENSIONS OF CREDIT.
RA 3765 became effective upon its approval, when was it approved?
June 22, 1963
Truth in Lending Act or RA _____
RA 3765
Purpose of RA 3765 in accordance with Section II of the Act
To protect its citizens from a lack of awareness of the true cost of credit to the user by assuring a full disclosure of such cost with a view of preventing the uninformed use of credit to the detriment of the national economy.
Another purpose of RA 3765
To require creditors the disclosure of full information incident to a credit transaction.
T or F. Any creditor shall furnish to each person to whom credit is extended, after the consummation of the transaction, a clear statement oral or in writing setting forth, all information under the Section IV of the Act.
F.
Any creditor shall furnish to each person to whom credit is extended, PRIOR to the consummation of the transaction, a clear statement in WRITING setting forth, to the EXTENT APPLICABLE and in ACCORDANCE WITH RULES AND REGULATIONS prescribed by the Board, information under Section IV of the Act.
Information to be furnished by creditors to each person for whom credit is extended?
- the cash price or delivered price of the property or service to be acquired
- the amounts, if any, to be credited as downpayment and/or trade-in
- the difference between (1) and (2)
- the charges, individually itemized, which are paid or to be paid by such person in connection with the transaction but not incident to the extension of credit
- the total amount to be financed
- the finance charge expressed in terms of pesos or centavos
- the percentage that the finance bears to the total amount to be financed expressed as a simple annual rate on the outstanding unpaid balance of the obligation
Who are required to disclose such disclosures requirements under Section IV of RA 3765
- banks and other financial institutions
- any persons engaged in the business of extensions of credits (including persons engaged in the business of selling or renting of property or services on a time, credit, and installment basis, either as a principal or agent)
T or F. In case of non-compliance with the provisions of RA 3765, the credit transaction in question remains valid and enforceable.
True
Remedies available to the debtor in case of non-compliance of creditors with regard to the provisions of RA 3765.
file a civil case for recovery of damages in the amount of Php 100 or twice the amount of the finance charge required by the creditor, whichever is higher
The validity period of the action to recover such penalty.
Action to recover such penalty may be brought by such person within 1 year from the date of the occurrence of the violation, in any court of competent jurisdiction
Any person who willfully violates any provision of RA 3765 or any regulation issued thereunder shall be subjected to penalties and punishment like?
- fine not less than P1,00 or more than P5,000; or
- imprisonment for not less than 6 months, nor more than one year; or
- both
Any person who willfully violates any provision of RA 3765 or any regulation issued thereunder shall be subjected to penalties and punishment like?
- fine not less than P1,00 or more than P5,000; or
- imprisonment for not less than 6 months, nor more than one year; or
- both
TT or F. The punishment or penalty provided in Section VI of RA 3765 shall also apply to the Philippine Government or any of its agencies or any of its political subdivisions provided that they are creditors in a credit transaction.
False.
No punishment or penalty provided in this Act shall apply to the Philippine Government or any agency or any political subdivision thereof.
