ENHANCED DISCLOSURE FOR CREDIT EXTENSIONS SECURED BY A DWELLING.

SEC. 1302. ENHANCED DISCLOSURE FOR CREDIT EXTENSIONS SECURED BY A DWELLING.(a) Open End Credit Extensions.—(1) Credit applications.—Section 127A(a)(13) of the Truth in Lending Act (15 U.S.C. 1637a(a)(13)) is amended—(A) by striking “consultation of tax adviser.—A statement that the” and inserting the following: “tax deductibility.—A statement that—“(A) the”; and(B) by striking the period at the end and inserting the following: “; and“(B) in any case in which the extension of credit exceeds the fair market value (as defined under the Internal Revenue Code of 1986) of the dwelling, the interest on the portion of the credit extension that is greater than the fair market value of the dwelling is not tax deductible for Federal income tax purposes.”.(2) Credit advertisements.—Section 147(b) of the Truth in Lending Act (15 U.S.C. 1665b(b)) is amended—(A) by striking “If any” and inserting the following:“(1) In general.—If any”; and(B) by adding at the end the following:“(2) Credit in excess of fair market value.—Each advertisement described in subsection (a) that relates to an extension of credit that may exceed the fair market value of the dwelling, and which advertisement is disseminated in paper form to the public or through the Internet, as opposed to by radio or television, shall include a clear and conspicuous statement that—“(A) the interest on the portion of the credit extension that is greater than the fair market value of the dwelling is not tax deductible for Federal income tax purposes; and“(B) the consumer should consult a tax adviser for further information regarding the deductibility of interest and charges.”.(b) Non-Open End Credit Extensions.—119 STAT. 209(1) Credit applications.—Section 128 of the Truth in Lending Act (15 U.S.C. 1638) is amended—(A) in subsection (a), by adding at the end the following:“(15) In the case of a consumer credit transaction that is secured by the principal dwelling of the consumer, in which the extension of credit may exceed the fair market value of the dwelling, a clear and conspicuous statement that—“(A) the interest on the portion of the credit extension that is greater than the fair market value of the dwelling is not tax deductible for Federal income tax purposes; and“(B) the consumer should consult a tax adviser for further information regarding the deductibility of interest and charges.”; and(B) in subsection (b), by adding at the end the following:“(3) In the case of a credit transaction described in paragraph (15) of subsection (a), disclosures required by that paragraph shall be made to the consumer at the time of application for such extension of credit.”.(2) Credit advertisements.—Section 144 of the Truth in Lending Act (15 U.S.C. 1664) is amended by adding at the end the following:“(e) Each advertisement to which this section applies that relates to a consumer credit transaction that is secured by the principal dwelling of a consumer in which the extension of credit may exceed the fair market value of the dwelling, and which advertisement is disseminated in paper form to the public or through the Internet, as opposed to by radio or television, shall clearly and conspicuously state that—“(1) the interest on the portion of the credit extension that is greater than the fair market value of the dwelling is not tax deductible for Federal income tax purposes; and“(2) the consumer should consult a tax adviser for further information regarding the deductibility of interest and charges.”.(c) Regulatory Implementation.—(1) In general.—The Board shall promulgate regulations implementing the amendments made by this section. (2) Effective date.—Regulations issued under paragraph (1) shall not take effect until the later of—(A) 12 months after the date of enactment of this Act; or (B) 12 months after the date of publication of such final regulations by the Board.