[Code of Federal Regulations]

[Title 12, Volume 3]

[Revised as of January 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 12CFR226.26]



[Page 308]

 

                       TITLE 12--BANKS AND BANKING

 

                   CHAPTER II--FEDERAL RESERVE SYSTEM

 

PART 226_TRUTH IN LENDING (REGULATION Z)--Table of Contents

 

                         Subpart D_Miscellaneous

 

Sec. 226.26  Use of annual percentage rate in oral disclosures.



    (a) Open-end credit. In an oral response to a consumer's inquiry 

about the cost of open-end credit, only the annual percentage rate or 

rates shall be stated, except that the periodic rate or rates also may 

be stated. If the annual percentage rate cannot be determined in advance 

because there are finance charges other than a periodic rate, the 

corresponding annual percentage rate shall be stated, and other cost 

information may be given.

    (b) Closed-end credit. In an oral response to a consumer's inquiry 

about the cost of closed-end credit, only the annual percentage rate 

shall be stated, except that a simple annual rate or periodic rate also 

may be stated if it is applied to an unpaid balance. If the annual 

percentage rate cannot be determined in advance, the annual percentage 

rate for a sample transaction shall be stated, and other cost 

information for the consumer's specific transaction may be given.