**(a) In general** In accordance with regulations of the Farm Credit Administration, qualified lenders shall provide to borrowers, for all loans that are not subject to the Truth in Lending Act ([15 U.S.C. 1601](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title15-section1601&num=0&edition=prelim) et seq.), meaningful and timely disclosure not later than the time of the loan closing, of—
(1) the current rate of interest on the loan;
(2) in the case of an adjustable or variable rate loan, the amount and frequency by which the interest rate can be increased during the term of the loan or, if there are no such limitations, a statement to that effect, and the factors (including the cost of funds, operating expenses, and provision for loan losses) that will be taken into account by the qualified lender in determining adjustments to the interest rate;
(3) the effect, as shown by a representative example or examples, of any loan origination charges or purchases of stock or participation certificates on the effective rate of interest;
(4) any change in the interest rate applicable to the borrower’s loan, and notice to the borrower of a change in the interest rate applicable to the loan of the borrower may be made within a reasonable time after the effective date of an increase or decrease in the interest rate;
(5) except with respect to stock guaranteed under [section 2162 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section2162&num=0&edition=prelim), a statement indicating that stock that is purchased is at risk; and
(6) a statement indicating the various types of loan options available to borrowers, with an explanation of the terms and borrowers’ rights that apply to each type of loan.
**(b) Differential interest r
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Stable record: federal_law:legal_authorities:record_usc_eb5cefd4decff863533e558e Source file: Laws/federal/codes/united-states-code/title-12/section-2201-disclosure--ca993e966d.md Pages: Not recorded – Not recorded Passage SHA-256: a98bca999071e6ab4605b3650ec876f5c0a66373ff7b3af28356b1203f3be0da Retained source evidence SHA-256: 482ae4ef2b3aa266dc0c20ee0239cdb5dae02ef6462d679e4ec815dab857acc6
Source location: Title 12, Chapter 23, § 2201; chapter-023-farm-credit-system.md
Stored source content
**(a) In general** In accordance with regulations of the Farm Credit Administration, qualified lenders shall provide to borrowers, for all loans that are not subject to the Truth in Lending Act ([15 U.S.C. 1601](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title15-section1601&num=0&edition=prelim) et seq.), meaningful and timely disclosure not later than the time of the loan closing, of—
(1) the current rate of interest on the loan;
(2) in the case of an adjustable or variable rate loan, the amount and frequency by which the interest rate can be increased during the term of the loan or, if there are no such limitations, a statement to that effect, and the factors (including the cost of funds, operating expenses, and provision for loan losses) that will be taken into account by the qualified lender in determining adjustments to the interest rate;
(3) the effect, as shown by a representative example or examples, of any loan origination charges or purchases of stock or participation certificates on the effective rate of interest;
(4) any change in the interest rate applicable to the borrower’s loan, and notice to the borrower of a change in the interest rate applicable to the loan of the borrower may be made within a reasonable time after the effective date of an increase or decrease in the interest rate;
(5) except with respect to stock guaranteed under [section 2162 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section2162&num=0&edition=prelim), a statement indicating that stock that is purchased is at risk; and
(6) a statement indicating the various types of loan options available to borrowers, with an explanation of the terms and borrowers’ rights that apply to each type of loan.
**(b) Differential interest rates** A qualified lender offering more than one rate of interest to borrowers shall, at the request of a borrower of a loan—
(1) provide a review of the loan to determine if the proper interest rate has been established;
(2) explain to the borrower in writing the basis for the interest rate charged; and
(3) explain to the borrower in writing how the credit status of the borrower may be improved to receive a lower interest rate on the loan.
Cross-references
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Federal law — U.S. Code and appendices · legal_authorities
§ 2201. Notice of action on application
(a) Loan applications
Each qualified lender to which a person has
applied for a loan shall provide the person with
prompt written notice of—
(1) the action on the application;
(2) if the loan applied for is reduced or de-
nied, the reasons for such action; and
(3) the applicant’s right to review under sec-
tion 2202 of this title.
(b) Distressed loans
Each qualified lender that has a distressed
loan outstanding that is subject to restructuring
requirements under this chapter shall provide,
in accordance with regulations prescribed by the
Farm Credit Administration, the borrower with
prompt written notice of—
(1) any action taken with respect to restruc-
turing the loan under section 2202a of this
title;
(2) if restructuring is denied, the reasons for
such action; and
(3) the borrower’s right to review under sec-
tion 2202 of this title.
(Pub. L. 92–181, title IV, § 4.13B, formerly § 4.13,
Dec. 10, 1971, 85 Stat. 613, renumbered § 4.13B and
amended Pub. L. 99–205, title III, §§ 301(a), 302,
Dec. 23, 1985, 99 Stat. 1707, 1708; Pub. L. 100–233,
title I, § 105, Jan. 6, 1988, 101 Stat. 1579.)
Editorial Notes
AMENDMENTS
1988—Pub. L. 100–233 amended section generally. Prior
to amendment, section read as follows: ‘‘Every appli-
cant for a loan from an institution of the System shall
be entitled to prompt written notice of action on his
application, and, if the loan applied for is reduced or
denied, the reason for such action, and of the appli-
cant’s right to review under section 2202 of this title.’’
1985—Pub. L. 99–205, § 302, provided for a ‘‘written’’ no-
tice and for the applicant’s right to review under sec-
tion 2202 of this title.
Statutory Notes and Related Subsidiaries
EFFECTIVE DATE OF 1985 AMENDME
**(a) Informed use of credit** The Congress finds that economic stabilization would be enhanced and the competition among the various financial institutions and other firms engaged in the extension of consumer credit would be strengthened by the informed use of credit. The informed use of credit results from an awareness of the cost thereof by consumers. It is the purpose of this subchapter to assure a meaningful disclosure of credit terms so that the consumer will be able to compare more readily the various credit terms available to him and avoid the uninformed use of credit, and to protect the consumer against inaccurate and unfair credit billing and credit card practices.
**(b) Terms of personal property leases** The Congress also finds that there has been a recent trend toward leasing automobiles and other durable goods for consumer use as an alternative to installment credit sales and that these leases have been offered without adequate cost disclosures. It is the purpose of this subchapter to assure a meaningful disclosure of the terms of leases of personal property for personal, family, or household purposes so as to enable the lessee to compare more readily the various lease terms available to him, limit balloon payments in consumer leasing, enable comparison of lease terms with credit terms where appropriate, and to assure meaningful and accurate disclosures of lease terms in advertisements.
Stored review status: release_metadata_unconfirmed. The source passage cites 15 U.S.C. § 1601. This identifies an authority to review, not proof of applicability.
Federal law — U.S. Code and appendices · legal_authorities
§ 1601. Congressional findings and declaration of
purpose
(a) Informed use of credit
The Congress finds that economic stabiliza-
tion would be enhanced and the competition
among the various financial institutions and
other firms engaged in the extension of con-
sumer credit would be strengthened by the in-
formed use of credit. The informed use of credit
results from an awareness of the cost thereof by
consumers. It is the purpose of this subchapter
to assure a meaningful disclosure of credit
terms so that the consumer will be able to com-
pare more readily the various credit terms
available to him and avoid the uninformed use
of credit, and to protect the consumer against
inaccurate and unfair credit billing and credit
card practices.
(b) Terms of personal property leases
The Congress also finds that there has been a
recent trend toward leasing automobiles and
other durable goods for consumer use as an al-
ternative to installment credit sales and that
these leases have been offered without adequate
cost disclosures. It is the purpose of this sub-
chapter to assure a meaningful disclosure of the
terms of leases of personal property for per-
sonal, family, or household purposes so as to en-
able the lessee to compare more readily the var-
ious lease terms available to him, limit balloon
payments in consumer leasing, enable compari-
son of lease terms with credit terms where ap-
propriate, and to assure meaningful and accu-
rate disclosures of lease terms in advertise-
ments.
Page 1453
TITLE 15—COMMERCE AND TRADE
§ 1601
(Pub. L. 90–321, title I, § 102, May 29, 1968, 82 Stat.
146; Pub. L. 93–495, title III, § 302, Oct. 28, 1974, 88
Stat. 1511; Pub. L. 94–240, § 2, Mar. 23, 1976, 90
Stat. 257.)
Editorial Notes
AMENDMENTS
1976—Pub. L. 94–240 des
Stored review status: historical_2024_not_currentness_verified. The source passage cites 15 U.S.C. § 1601. This identifies an authority to review, not proof of applicability.