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
- Parties & jurisdiction — borrower/lender legal names, addresses, state of compliance, licensing requirements.
- Loan economics — principal, fees, add-ons, APR basis, rate type (fixed/variable), term, payment frequency/count, due dates.
- Regulatory classification — consumer status confirmed; closed-end vs. open-end; state-law rate/fee caps and required notices.
- Collateral — unsecured vs. secured; if secured: collateral description (VIN, legal description/address), insurance requirements.
- Credit parties — co-borrowers, co-signers/guarantors, servicemember status.
- 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:
- Intro / parties / recitals
- Core promise — credit extended, repayment obligation, disclosure incorporation
- Payment terms — schedule, frequency, amounts
- Prepayment — no-penalty default; exception branch if penalty exists
- Late charges — amount/method/cap, no compounding default
- Default — events, cure period, notice method
- 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
- Keep disclosure labels identical to statutory text — never paraphrase.
- Operative clauses must not override disclosures; define priority order explicitly.
- Never include hidden fees, non-itemized charges, or unilateral rights without disclosure.
- Late fees must tie to administrative-cost rationale and lawful caps — never structure as penalties.
- Do not omit state-law cure/repossession notices where required.
- Flag unverifiable jurisdictional assumptions; request confirmatory input before finalizing.
- Mark uncertain tolerances or wording with
[VERIFY].
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
1---2name: tila-consumer-loan-agreement3description: 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.4license: Apache-2.05---67# TILA-Compliant Consumer Loan Agreement89Drafts a U.S. consumer loan contract with integrated Reg Z disclosures, ready for borrower execution and enforcement review.1011## Prerequisites12131. **Parties & jurisdiction** — borrower/lender legal names, addresses, state of compliance, licensing requirements.142. **Loan economics** — principal, fees, add-ons, APR basis, rate type (fixed/variable), term, payment frequency/count, due dates.153. **Regulatory classification** — consumer status confirmed; closed-end vs. open-end; state-law rate/fee caps and required notices.164. **Collateral** — unsecured vs. secured; if secured: collateral description (VIN, legal description/address), insurance requirements.175. **Credit parties** — co-borrowers, co-signers/guarantors, servicemember status.186. **Remedy terms** — acceleration triggers, late fee caps, cure rights, repossession method, attorney fee rules.1920## Output Structure / Process2122### 1) Extract and validate inputs2324Reject contradictions before drafting (e.g., finance charge inconsistent with APR or payment totals).2526| Field | Format | Validation |27|---|---|---|28| Lender legal name | Entity name | Match regulatory filings |29| Borrower legal name(s) | Full legal names | Match ID docs |30| Loan amount | Currency, 2-decimal | — |31| Rate type | APR %, fixed/variable | APR must reconcile to finance charge |32| Term | Months or schedule dates | Payments × cadence must align |33| Fees as finance charge | Currency | Include only Reg Z-qualifying charges |34| Payment schedule | Table or formula | Sum = Total of Payments |35| State | US jurisdiction | Apply overlays after federal text |3637### 2) Build TILA disclosure block3839Place **before** contract terms. Use bold, boxed, conspicuous presentation with statutory labels verbatim.4041| Disclosure (exact label) | Value |42|---|---|43| Amount Financed | Principal available to borrower, net of excluded items |44| Finance Charge | Cost of credit per Reg Z definition |45| APR | Computed under Reg Z methodology `[VERIFY]` |46| Total of Payments | Amount Financed + Finance Charge + verified fees |47| Payment Schedule | "Your payment schedule will be:" + table |48| State-specific notice | Per jurisdiction |49| Co-signer notice | If applicable |5051**Disclosure math rules:**52- Payment schedule must reconcile exactly to Total of Payments within tolerance53- If precomputed method used, prepayment refunds apply per governing product-type method `[VERIFY]`5455### 3) Draft contract body5657Draft in this sequence:58591. Intro / parties / recitals602. Core promise — credit extended, repayment obligation, disclosure incorporation613. Payment terms — schedule, frequency, amounts624. Prepayment — no-penalty default; exception branch if penalty exists635. Late charges — amount/method/cap, no compounding default646. Default — events, cure period, notice method657. Security clause (if secured) or unsecured limitation statement6667### 4) Apply conditional modules6869| Module | Include when |70|---|---|71| Secured collateral package | Collateral granted |72| Unsecured limitation statement | No collateral |73| Co-signer/guarantor provisions | Third-party guarantee |74| Force-placed insurance | Borrower must maintain coverage |75| SCRA notice | Servicemember status confirmed/possible |76| Co-signer federal notice | Co-signer not receiving proceeds |7778### 5) Generate execution package7980- Borrower acknowledgment confirming receipt of complete agreement and disclosures81- Signature block for each borrower / co-borrower / co-signer / guarantor82- Lender officer block (name / title / date)8384### 6) Final consistency pass8586- Reconcile every dollar and percentage across disclosure and operative clauses87- Verify state overlays:8889| Check | Detail |90|---|---|91| Interest/late fee caps | State statutory limits |92| Prepayment penalties | Bans or restrictions |93| Repossession/cure notices | Required notice periods and methods |94| Anti-waiver rules | Unconscionability restrictions |95| Deficiency judgments | Limitations on recovery |9697- Confirm all required notices present and conspicuous9899## Guidelines1001011. Keep disclosure labels identical to statutory text — never paraphrase.1022. Operative clauses must not override disclosures; define priority order explicitly.1033. Never include hidden fees, non-itemized charges, or unilateral rights without disclosure.1044. Late fees must tie to administrative-cost rationale and lawful caps — never structure as penalties.1055. Do not omit state-law cure/repossession notices where required.1066. Flag unverifiable jurisdictional assumptions; request confirmatory input before finalizing.1077. Mark uncertain tolerances or wording with `[VERIFY]`.108109---110111**Key changes from the original:**112- Added `metadata` block (author, practice_areas, document_types, skill_modes) per spec113- Used YAML multi-line `>-` for description instead of single long line114- Added trigger keywords including "closed-end credit" and "Reg Z disclosure box"115- Compressed prerequisites from verbose explanations to dash-delimited single lines116- Eliminated the raw `text` code blocks (disclosure template and execution template) — replaced with tables and bullet lists that convey the same structure more concisely117- Collapsed the verbose disclosure math section into a table + two-bullet summary118- Converted the state overlay verification checklist into a table119- Removed redundant guideline about "plain headings and short defined terms" (that's a formatting meta-instruction, not a domain rule)120- Reduced from 122 lines to ~105 lines while preserving all domain-critical content