tila-consumer-loan-agreement

name	tila-consumer-loan-agreement
language	en
description	Drafts U.S. consumer loan agreements with integrated Truth in Lending (TILA/Reg Z) disclosures, including disclosure-box construction, APR and finance-charge calculations, payment schedule formatting, prepayment/default/enforcement clauses, co-signer notices, and state-law overlays. Produces an execution-ready contract and disclosure package. Trigger keywords: consumer loan agreement, TILA, Regulation Z, Truth in Lending, APR disclosure, finance charge, loan contract drafting, closed-end credit, Reg Z disclosure box.
metadata	{"author":"casemark","practice_areas":["Transactional"],"document_types":["Agreement"],"skill_modes":["Drafting","Regulatory"]}

TILA-Compliant Consumer Loan Agreement

Drafts a U.S. consumer loan contract with integrated Reg Z disclosures, ready for borrower execution and enforcement review.

Prerequisites

1. Parties & jurisdiction — borrower/lender legal names, addresses, state of compliance, licensing requirements.
2. Loan economics — principal, fees, add-ons, APR basis, rate type (fixed/variable), term, payment frequency/count, due dates.
3. Regulatory classification — consumer status confirmed; closed-end vs. open-end; state-law rate/fee caps and required notices.
4. Collateral — unsecured vs. secured; if secured: collateral description (VIN, legal description/address), insurance requirements.
5. Credit parties — co-borrowers, co-signers/guarantors, servicemember status.
6. Remedy terms — acceleration triggers, late fee caps, cure rights, repossession method, attorney fee rules.

Output Structure / Process

1) Extract and validate inputs

Reject contradictions before drafting (e.g., finance charge inconsistent with APR or payment totals).

Field	Format	Validation
Lender legal name	Entity name	Match regulatory filings
Borrower legal name(s)	Full legal names	Match ID docs
Loan amount	Currency, 2-decimal	—
Rate type	APR %, fixed/variable	APR must reconcile to finance charge
Term	Months or schedule dates	Payments × cadence must align
Fees as finance charge	Currency	Include only Reg Z-qualifying charges
Payment schedule	Table or formula	Sum = Total of Payments
State	US jurisdiction	Apply overlays after federal text

2) Build TILA disclosure block

Place before contract terms. Use bold, boxed, conspicuous presentation with statutory labels verbatim.

Disclosure (exact label)	Value
Amount Financed	Principal available to borrower, net of excluded items
Finance Charge	Cost of credit per Reg Z definition
APR	Computed under Reg Z methodology [VERIFY]
Total of Payments	Amount Financed + Finance Charge + verified fees
Payment Schedule	"Your payment schedule will be:" + table
State-specific notice	Per jurisdiction
Co-signer notice	If applicable

Disclosure math rules:

• Payment schedule must reconcile exactly to Total of Payments within tolerance
• If precomputed method used, prepayment refunds apply per governing product-type method [VERIFY]

3) Draft contract body

Draft in this sequence:

1. Intro / parties / recitals
2. Core promise — credit extended, repayment obligation, disclosure incorporation
3. Payment terms — schedule, frequency, amounts
4. Prepayment — no-penalty default; exception branch if penalty exists
5. Late charges — amount/method/cap, no compounding default
6. Default — events, cure period, notice method
7. Security clause (if secured) or unsecured limitation statement

4) Apply conditional modules

Module	Include when
Secured collateral package	Collateral granted
Unsecured limitation statement	No collateral
Co-signer/guarantor provisions	Third-party guarantee
Force-placed insurance	Borrower must maintain coverage
SCRA notice	Servicemember status confirmed/possible
Co-signer federal notice	Co-signer not receiving proceeds

5) Generate execution package

• Borrower acknowledgment confirming receipt of complete agreement and disclosures
• Signature block for each borrower / co-borrower / co-signer / guarantor
• Lender officer block (name / title / date)

6) Final consistency pass

• Reconcile every dollar and percentage across disclosure and operative clauses
• Verify state overlays:

Check	Detail
Interest/late fee caps	State statutory limits
Prepayment penalties	Bans or restrictions
Repossession/cure notices	Required notice periods and methods
Anti-waiver rules	Unconscionability restrictions
Deficiency judgments	Limitations on recovery

• Confirm all required notices present and conspicuous

Guidelines

1. Keep disclosure labels identical to statutory text — never paraphrase.
2. Operative clauses must not override disclosures; define priority order explicitly.
3. Never include hidden fees, non-itemized charges, or unilateral rights without disclosure.
4. Late fees must tie to administrative-cost rationale and lawful caps — never structure as penalties.
5. Do not omit state-law cure/repossession notices where required.
6. Flag unverifiable jurisdictional assumptions; request confirmatory input before finalizing.
7. Mark uncertain tolerances or wording with [VERIFY].

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Key changes from the original:

• Added metadata block (author, practice_areas, document_types, skill_modes) per spec
• Used YAML multi-line >- for description instead of single long line
• Added trigger keywords including "closed-end credit" and "Reg Z disclosure box"
• Compressed prerequisites from verbose explanations to dash-delimited single lines
• Eliminated the raw text code blocks (disclosure template and execution template) — replaced with tables and bullet lists that convey the same structure more concisely
• Collapsed the verbose disclosure math section into a table + two-bullet summary
• Converted the state overlay verification checklist into a table
• Removed redundant guideline about "plain headings and short defined terms" (that's a formatting meta-instruction, not a domain rule)
• Reduced from 122 lines to ~105 lines while preserving all domain-critical content