Alert reminds: Reg Z threshold adjustments take effect Jan. 1

(Dec. 3, 2021) A regulatory alert on Truth in Lending (Regulation Z) annual threshold adjustments for various loans – which take effect Jan. 1 — was issued this week by NCUA, following up on action taken by the CFPB earlier this fall.

The NCUA alert (RA-21-10) notes that the adjustments for credit cards, closed-end home equity loans and qualified mortgages (QMs) are based on the annual percentage change reflected in the Consumer Price Index (CPI) as of June 1, 2021. CFPB is required to calculate the dollar amounts for several provisions in Reg Z each year.

In late October, the bureau increased many, but not all, of the threshold dollar amounts for the loans covered under Reg Z. No change in the $1 threshold triggering minimum interest charge disclosure requirements on open-end consumer credit plans was made, for example.

For open-end credit plans under the CARD Act, there were increases to $30 in the adjusted dollar amount for safe harbor for a first violation penalty fee and to $41 in the threshold for a subsequent violation penalty fee. For HOEPA loans, the adjusted total loan amount threshold for high-cost mortgages in 2022 will be $22,969, the agency said; the adjusted points-and-fees dollar trigger will be $1,148.

For QMs, the changes are a bit more complicated, with various thresholds for the spread between the annual percentage rate (APR) and the average prime offer rate (APOR) in 2022. The changes are detailed in the alert.


NCUA Regulatory Alert 21-RA-10: 2022 Truth in Lending (Regulation Z) Annual Threshold Adjustments (Credit Cards, HOEPA, and Qualified Mortgages)