Can fees be deducted from interest earned on deposits according to TISA?

The correct answer is that fees can indeed be deducted from interest earned on deposits, but such fees must be clearly disclosed to the account holder. The Truth in Savings Act (TISA) requires financial institutions to provide transparent information about account terms, including any fees that may apply. This obligation ensures that consumers are aware of the potential impacts of these fees on their interest earnings, enabling them to make informed decisions about their deposit accounts.

Clear disclosure allows account holders to understand the cost of maintaining their accounts versus the interest they can earn, which is crucial for effective personal financial management. By outlining all applicable fees upfront, institutions foster transparency and trust. This requirement applies broadly to consumer accounts and is not limited to specific types of accounts or situations. Therefore, the emphasis is on the necessity for lenders to provide this information clearly, ensuring that all terms surrounding the account are fully understood by customers.