[Congressional Record Volume 148, Number 131 (Tuesday, October 8, 2002)]
[Extensions of Remarks]
[Page E1793]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


          H.R. 5507--TRUTH IN LENDING INFLATION ADJUSTMENT ACT

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                          HON. JOHN J. LaFALCE

                              of new york

                    in the house of representatives

                        Tuesday, October 8, 2002

  Mr. LaFALCE. Mr. Speaker, I rise today in support of H.R. 5507, a 
bill to update and enhance an important consumer credit protection. In 
1968, Congress enacted the Truth in Lending Act to ensure that 
consumers receive accurate and meaningful disclosure of the costs of 
consumer credit. Such disclosures enable American consumers to compare 
credit terms and make informed credit decisions. Prior to 1968, 
consumers had no easy way to determine the true cost of their credit 
transactions--nor did they have a basis for comparing the various 
creditors in the marketplace.
  TILA addressed this problem by providing a standardized finance cost 
calculation--the annual percentage rate, or APR--and by requiring 
creditors to provide clear and accurate disclosures of all credit terms 
and costs. Over the past 30 years, however, key statutory protections 
and remedies, stated in 1968 dollars, have not been updated to reflect 
inflation and to provide comparable protections in today's dollars.
  The bill we are considering today, H.R. 5507, though modest in scope, 
provides the first update of an important section of TILA in 34 years. 
This is clearly an overdue change in the law. TILA protections apply to 
all credit transactions secured by home equity and other non-business 
consumer loans or leases under $25,000. In 1968, this $25,000 limit on 
unsecured credit and lease transactions was considered more than 
adequate to ensure that most automobile, credit card, and personal loan 
transactions would be covered. This is clearly not the case today. It 
is now quite common for many non-mortgage credit transactions to exceed 
$25,000. H.R. 5507 ensures that TILA protections will continue to apply 
to most consumer credit and lease transactions by raising the statutory 
exemption from $25,000 to $75,000. By doing so, we are providing 
updated protections to consumers that will ensure that a broader range 
of transactions are covered by TILA.
  Though I welcome the overdue change provided for in H.R. 5507, 1 
would have preferred that the agreement we reached with my Republican 
colleagues on the Financial Services Committee to schedule this bill, 
would have also included other provisions from my broader TILA 
modernization bill, H.R. 1054. This comprehensive bill, which I 
introduced at the outset of the 107th Congress and is known as the 
Truth in Lending Modernization Act of 2001, amends TILA to restore 
important consumer protections that have been weakened by inflation. It 
also ensures that consumers benefit from advances in accounting 
technology, and strengthens TILA's civil liability and recission 
remedies. But I am nonetheless very pleased that we were able to agree 
on bringing up H.R. 5507 to the House today along with H.R. 163, a bill 
to amend the Fair Debt Collection Practices Act, and H.R. 4005, a bill 
to make the District of Columbia and the U.S. territories part of the 
ongoing commemorative quarters program.
  Mr. Speaker, I urge support for this long-overdue legislation and 
reserve the balance of my time.

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