CFPB Adjusts Reg Z Thresholds 

Loan Amount  Points and Fees Limit
$101,953 3 percent
$61,172 - $101,952  $3,059
$20,391 - $61,171 5 percent
$12,744 - $19,999.99 $1,020
$12,743 or less 8 percent

On an annual basis, the Consumer Financial Protection Bureau is required to adjust certain threshold amounts within Regulation Z, based on inflation, which implements the Truth in Lending Act, based on inflation. Below are the revised thresholds which were published in the Federal Register on Aug. 15 and become effective on Jan. 1, 2015. 

Card Act
The safe harbor amount for penalty fees has been raised by $1. After Jan. 1, a card issuer cannot impose a fee that exceeds $27 or $38 for violating the terms of the account if the card issuer previously imposed a fee for a violation of the same type that occurred during the same billing cycle or one of the next six billing cycles. A few examples of the fees subject to these limitations include late payment fees, returned payment fees and fees for an over-the-limit transaction.
Home Ownership Equity Protection Act
The dollar amount threshold used in connection with calculating whether a transaction meets the percentage point thresholds in the points and fees coverage test for a high-cost mortgage will be increased by two percent to $20,391. Therefore, after Jan. 1, if the loan amount is above $20,391 and the points and fees exceed eight percent of the total loan amount or $1,020, which was also increased by two percent (whichever is less), the loan would be considered high-cost under the rule.

Ability to Repay/Qualified Mortgage Thresholds
When determining whether a transaction is a qualified mortgage, the total points and fees cannot exceed certain limits. Below are the revised thresholds as of Jan. 1.

Submissions to Monitor may be emailed. Bryan Laviolette is the editor of Monitor. Contact him by email or call (800) 262-6285, ext. 233. The newsletter of the Michigan Credit Union League is published Monday mornings or Tuesday mornings when Monday is a holiday. There is no Monitor the week after Christmas and the week after the Annual Convention and Exposition. The MCUL reserves the right to edit submissions for clarity and space.
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