Truth in Lending Act - Regulation Z
The Truth in Lending Act (TILA) which is implemented by Regulation Z is to provided uniform disclosures for consumer to comparison shop loan products. Regulation Z covers both open-end and closed-end consumer products. A short list of some of the requirements of Regulation Z include the following:

• Requires that all oral or written disclosures of the interest rates be provided as annual percentage rate
• Requires disclosure of a number of terms and conditions (i.e. amount financed, annual percentage rate, finance charge, late fees, and payment schedule) to a borrower prior to being obligated under a contract
• Requires a borrower to have a three day rescission period to cancel the loan when using his/her primary residence as collateral
• Requires certain disclosures for advertising loan products

One important term that Regulation Z has defined is "annual percentage rate" or "APR." The APR is the "cost of credit" to the borrower and enables a customer to compare different loan offers. The APR calculates the interest rate and other fees and charges that may be associated with obtaining credit. There are certain fees that are not APR impacting since they are associated with obtaining credit. For example , fees paid by the borrower for  recording and taxes are not considered APR impacting.

Thus is it important to remember that when quoting a rate to a customer, you always state the annual percentage rate.