REGULATION Z – SELECTED 2019 THRESHOLDS

On August 27, 2018 the Consumer financial Protection Bureau (CFPB published a final rule amending Regulation Z. The Bureau is required to calculate annually the dollar amounts for several provisions in Regulation Z; this final rule revises, as applicable, the dollar amounts for provisions implementing TILA and amendments to TILA, including under:

  • The Credit Card Accountability Responsibility and Disclosure Act of 2009 (CARD Act);
  • The Home Ownership and Equity Protection Act of 1994 (HOEPA); and
  • The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act).

The Bureau is adjusting these amounts, where appropriate, based on the annual percentage change reflected in the Consumer Price Index (CPI) in effect on June 1, 2018.

Credit Card Annual Adjustments

  • Minimum Interest Charge Disclosure Thresholds – The minimum interest charge amounts for §§ 1026.6(b)(2)(iii) and 1026.60(b)(3) will remain unchanged at $1.00 for the year 2019.
  • Safe Harbor Penalty Fees – Effective January 1, 2019, the permissible fee threshold amounts increased by $1 and are $28 for § 1026.52(b)(1)(ii)(A) and $39 for § 1026.52(b)(1)(ii)(B).

 HOEPA Annual Threshold Adjustments

Effective January 1, 2019, for purposes of determining under § 1026.32(a)(1)(ii) the points-and-fees coverage test under HOEPA to which a transaction is subject, the total loan amount threshold is $21,549, and the adjusted points-and-fees dollar trigger under § 1026.32(a)(1)(ii)(B) is $1,077.

  • When the total loan amount for a transaction is $21,549 or more, and the points-and-fees amount exceeds 5 percent of the total loan amount, the transaction is a high-cost mortgage.
  • When the total loan amount for a transaction is less than $21,549, and the points-and-fees amount exceeds the lesser of the adjusted points-and-fees dollar trigger of $1,077 or 8 percent of the total loan amount, the transaction is a high-cost mortgage.

 Qualified Mortgages Annual Threshold Adjustments

Effective January 1, 2019, a covered transaction is not a qualified mortgage if, pursuant to § 1026.43(e)(3), the transaction’s total points and fees exceed:

  • 3 percent of the total loan amount for a loan amount greater than or equal to $107,747;
  • $3,232 for a loan amount greater than or equal to $64,648 but less than $107,747;
  • 5 percent of the total loan amount for loans greater than or equal to $21,549 but less than $64,648;
  • $1,077 for a loan amount greater than or equal to $13,468 but less than $21,549; or
  • 8 percent of the total loan amount for loans less than $13,468.

This final rule is effective January 1, 2019.

The final rule is available at:  https://www.federalregister.gov/documents/2018/08/27/2018-18209/truth-in-lending-regulation-z-annual-threshold-adjustments-credit-cards-hoepa-and-qualified

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