Part of the problem is that most judges see Reg. Z issues about as often as they see their ex-spouses. What the situation cried out for was for guidance from someone or some body that actually knew something about TILA and Reg. Z. Now, along comes the Federal Reserve Board to do exactly that. The FRB staff issues something called "Official Staff Commentary," which is the staff's
written understanding of what they think the TILA and Reg. Z requirements are. The mess that has developed in the courts is exactly the sort of mess that FRB staff can straighten out with the Commentary.
In December 2001, the Board issued proposed revisions to the Commentary that would explicitly address the TILA timing and delivery requirements. Basically, the proposed Commentary said that a creditor (for example, a car dealer) providing TILA disclosures and the credit contract in the same document (typical in car finance transactions) could meet the federal disclosure requirements by giving the completed contract containing the disclosures to the customer to read and sign. The proposed Commentary said that it was insufficient to merely show the contract to the customer - it had to be in the customer's possession, so that he or she could review the document in its entirety before signing and becoming obligated. On April 9, the Board issued its final revision to the Commentary, essentially adopting the proposed Commentary. The Commentary, as amended, now contains this example:
A creditor gives a consumer a multiple-copy form containing a credit agreement and TILA disclosures. The consumer reviews and signs the form and returns it to the creditor, who separates the copies and gives one copy to the consumer to keep. The creditor has satisfied the disclosure requirement. The Commentary revision should end the dispute in the courts about whether
the Polk opinion was right, wrong or just sloppily written, and should be of great help in connection with any pending cases. The new Commentary language won't help dealers who weren't giving their customers copies of their contracts containing TILA disclosures until a week or two after the sale transactions. Those folks will still be in trouble, and rightly so!