Truth in Lending (Regulation Z), 76033-76035 [2013-29844]
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Federal Register / Vol. 78, No. 241 / Monday, December 16, 2013 / Rules and Regulations
6–156. Failure to file this certification is
‘‘a fatal defect’’ in the nomination. Id. 1–
106.
Sections 6–114 and 6–116 vest special
election nominating authority in the
party committees, either directly or by
operation of state party rules. Under
these provisions, therefore, candidates
are placed on the general election ballot
‘‘in accordance with applicable state
law’’ as ‘‘a direct result’’ of the relevant
party committee vote. See 11 CFR
100.2(c)(1). Accordingly, the party
committee vote is a ‘‘primary election’’
within the meaning of the Act and
Commission regulations. See Advisory
Opinion 2004–20 (Farrell for Congress)
(determining that party convention
constituted primary election where
convention’s endorsement of only one
candidate caused candidate to be placed
directly on general election ballot);
Advisory Opinion 1992–25 (Owens for
Senate Committee) (concluding that
party convention constituted primary
election where candidate would be
placed directly on general election
ballot if candidate received at least 70%
of votes at convention). The subsequent
filing of a certification formalizes the
nomination, but such a filing is not the
primary election itself. See FEC v.
Citizens for Senator Wofford, No. 1:CV–
94–2057, slip op. at 8–10 (M.D. Pa. Sept.
27, 1995) (holding that state party
convention constituted ‘‘primary
election’’ under Act and Commission
regulations even though state law
required party to file subsequent
certificate of nomination with state).
For the foregoing reasons, the
Commission issues this interpretive rule
to clarify that the date of a special
primary election held pursuant to N.Y.
Elec. Law 6–114 or 6–116 is the date of
the party committee’s nomination vote.
To the extent that other states’
nominating procedures for special
elections are materially
indistinguishable from those of New
York, the Commission anticipates that
this interpretation would apply to such
other states as well.
This interpretive rule clarifies the
Commission’s interpretation of existing
statutory and regulatory provisions and
therefore does not constitute an agency
action subject to notice and comment
requirements or a delayed effective date
under the Administrative Procedure
Act. See 5 U.S.C. 553. The provisions of
the Regulatory Flexibility Act, which
apply when notice and comment are
required by the Administrative
Procedure Act or another statute, do not
apply. See 5 U.S.C. 603(a). The
Commission is not required to submit
this interpretive rule for congressional
review. See 2 U.S.C. 438(d)(1), (4).
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Dated: December 5, 2013.
On behalf of the Commission,
Ellen L. Weintraub,
Chair, Federal Election Commission.
[FR Doc. 2013–29597 Filed 12–13–13; 8:45 am]
BILLING CODE 6715–01–P
BUREAU OF CONSUMER FINANCIAL
PROTECTION
12 CFR Part 1026
Truth in Lending (Regulation Z)
Bureau of Consumer Financial
Protection.
ACTION: Final rule; official
interpretation.
AGENCY:
The Bureau of Consumer
Financial Protection (Bureau) is
publishing this final rule amending the
regulatory text and official
interpretations for Regulation Z, which
implements the Truth in Lending Act
(TILA). The Bureau is required to
calculate annually the dollar amounts
for several provisions in Regulation Z;
this final rule reviews the dollar
amounts for provisions implementing
amendments to TILA under the Credit
Card Accountability Responsibility and
Disclosure Act of 2009 (CARD Act) and
the Home Ownership and Equity
Protection Act of 1994 (HOEPA). These
amounts are adjusted, where
appropriate, based on the annual
percentage change reflected in the
Consumer Price Index in effect on June
1, 2013. The minimum interest charge
disclosure thresholds will remain
unchanged in 2014. The adjusted dollar
amount for the penalty fees safe harbor
in 2014 is $26 for a first late payment
and $37 for each subsequent violation
within the following six months. The
adjusted statutory fee trigger for HOPEA
loans is $632, effective January 1, 2014.
DATES: This final rule is effective
January 1, 2014.
FOR FURTHER INFORMATION CONTACT:
David Friend, Counsel, Office of
Regulations, Consumer Financial
Protection Bureau, 1700 G Street NW.,
Washington, DC 20552 at (202) 435–
7700.
SUPPLEMENTARY INFORMATION:
SUMMARY:
I. Background
A. CARD Act Annual Adjustments
In 2010, the Board of Governors of the
Federal Reserve System (Board)
published amendments to Regulation Z
implementing the Credit Card
Accountability Responsibility and
Disclosure Act of 2009 (CARD Act),
which amended the Truth in Lending
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76033
Act (TILA). Public Law 111–24, 123
Stat. 1734 (2009). Pursuant to the CARD
Act, the Board’s Regulation Z
amendments established new
requirements with respect to open-end
consumer credit plans, including
requirements for the disclosure of
minimum interest charge amounts and
the establishment of a safe harbor
provision allowing card issuers to
impose penalty fees for violating
account terms without violating the
restrictions on penalty fees established
by the CARD Act. See 75 FR 7658, 7799
(Feb. 22, 2010) and 75 FR 37526, 37527
(June 29, 2010). The final rule issued by
the Board required that these thresholds
be calculated annually using the
Consumer Price Index as published by
the Bureau of Labor Statistics.1
Minimum Interest Charge Disclosure
Thresholds
Sections 1026.6(b)(2)(iii) and
1026.60(b)(3) of the Bureau’s Regulation
Z provide that the minimum interest
charge thresholds will be re-calculated
annually using the Consumer Price
Index for Urban Wage Earners and
Clerical Workers (CPI–W) that was in
effect on the preceding June 1. When the
cumulative change in the adjusted
minimum value derived from applying
the annual CPI–W level to the current
amounts in §§ 1026.6(b)(2)(iii) and
1026.60(b)(3) has risen by a whole
dollar, the minimum interest charge
amounts set forth in the regulation will
be increased by $1.00. The Bureau of
Labor Statistics publishes consumerbased indices monthly, but does not
report a CPI change on June 1;
adjustments are reported in the middle
of the month. The CPI–W is a subset of
the CPI–U index (based on all urban
consumers) and represents
approximately 28 percent of the U.S.
population. The adjustment reflects a
0.9 percent increase in the CPI–W from
April 2012 to April 2013 and is rounded
to the nearest $1 increment. This
increase in the CPI–W when applied to
the current amounts in
§§ 1026.6(b)(2)(iii) and 1026.60(b)(3) did
not trigger an increase in the minimum
interest charge threshold of at least
1 The responsibility for promulgating rules under
TILA was transferred from the Board to the Bureau
effective July 21, 2011. The Bureau restated
Regulation Z on December 22, 2011, and the
Bureau’s Regulation Z is located at 12 CFR part
1026. 76 FR 79768 (Dec. 22, 2011). See sections
1061 and 1100A of the Dodd-Frank Wall Street
Reform and Consumer Protection Act (Dodd-Frank
Act), Public Law 11–203, 124 Stat. 1376 (2010).
Section 1029 of the Dodd-Frank Act excludes from
this transfer of authority, subject to certain
exceptions, any rulemaking authority over a motor
vehicle dealer that is predominantly engaged in the
sale and servicing of motor vehicles, the leasing and
servicing of motor vehicles, or both.
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$1.00, and therefore the Bureau is not
amending §§ 1026.6(b)(2)(iii) and
1026.60(b)(3).
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Penalty Fees Safe Harbor
The Bureau’s Regulation Z provides
that the safe harbor provision which
establishes the permissible fee
thresholds in § 1026.52(b)(1)(ii)(A) and
(B) will be re-calculated annually using
the CPI–W that was in effect on the
preceding June 1. This adjustment is
based on the CPI–W index in effect on
June 1, 2013, which was reported on
May 16, 2013. The Bureau of Labor
Statistics publishes consumer-based
indices monthly, but does not report a
CPI change on June 1; adjustments are
reported in the middle of the month.
The CPI–W is a subset of the CPI–U
index (based on all urban consumers)
and represents approximately 28
percent of the U.S. population. When
the cumulative change in the adjusted
minimum value derived from applying
the annual CPI–W level to the current
amounts in § 1026.52(b)(1)(ii)(A) and (B)
has risen by a whole dollar, those
amounts will be increased by $1.00.
Similarly, when the cumulative change
in the adjusted minimum value derived
from applying the annual CPI–W level
to the current amounts in
§ 1026.52(b)(1)(ii)(A) and (B) has
decreased by a whole dollar, those
amounts will be decreased by $1.00. See
comment 52(b)(1)(ii)–2. The adjustment
to the permissible fee thresholds being
adopted here reflects a 0.9 percent
increase in the CPI–W from April 2012
to April 2013 and is rounded to the
nearest $1 increment.
B. HOEPA Annual Threshold
Adjustment
In 1995, the Board of Governors of the
Federal Reserve System (Board)
published amendments to Regulation Z
implementing the Home Ownership and
Equity Protection Act of 1994 (HOEPA),
which amended TILA and was
contained in the Riegle Community
Development and Regulatory
Improvement Act of 1994, Public Law
103–325, 108 Stat. 2160. These
amendments impose substantive
limitations and additional disclosure
requirements on certain closed-end
home mortgage loans bearing annual
percentage rates or points and fees
above a certain percentage or amount.
As enacted, the statute requires
creditors to comply with the HOEPA
requirements if the total points and fees
payable by the consumer at
consummation exceed the greater of
$400 or 8 percent of the total loan
amount. TILA and Regulation Z provide
that the $400 figure shall be adjusted
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annually on January 1 by the annual
percentage change in the Consumer
Price Index (CPI) that was reported on
the preceding June 1. 15 U.S.C.
1602(bb)(3); 12 CFR 1026.32(a)(1)(ii).
The Bureau uses the Consumer Price
Index for All Urban Consumers (CPI–U)
index, as published by the Bureau of
Labor Statistics (BLS), as the index for
adjusting the $400 figure. The CPI–U is
based on all urban consumers and
represents approximately 88 percent of
the U.S. population, The BLS publishes
consumer-based indices monthly, but
does not report a CPI change on June 1;
adjustments are reported in the middle
of each month. The adjustment to the
CPI–U index reported by BLS on May
16, 2013, was the CPI–U index in effect
on June 1, and reflects the percentage
change from April 2012 to April 2013.
The adjustment to the $400 figure being
adopted here reflects a 1.1 percent
increase in the CPI–U index for this
period and is rounded to whole dollars
for ease of compliance.
The fee trigger being adjusted in this
Federal Register notice pursuant to
TILA section 103(bb) is used in
determining whether a loan is covered
by § 1026.32. Such loans have generally
been known as ‘‘HOEPA loans.’’ On
January 10, 2013, the Bureau issued a
final rule pursuant to, inter alia, section
1431 of the Dodd-Frank Act, which
revised the statutory fee trigger for
HOEPA loans. 78 FR 6856 (Jan. 31,
2013) (2013 HOEPA Final Rule). The
amendments adopted in the 2013
HOEPA Final Rule, including the
revised fee trigger, apply to loans for
which the creditor received an
application on or after January 10, 2014.
Id. at 6939. The Bureau is mindful of the
need to coordinate implementation of
this final rule with the effective date of
the January 10th final rule adopting
revisions to the HOEPA fee trigger.
Accordingly, the adjustment to the fee
trigger that is being published today will
become effective on January 1, 2014,
will apply to loans consummated on or
after January 1, 2014, and will apply
until the revised HOEPA fee trigger
takes effect. Pursuant to section 1431 of
the Dodd Frank Act and
§ 1026.32(a)(1)(ii) as amended by the
2013 HOEPA Final Rule,
implementation of the 2013 HOEPA
Final Rule will change the HOEPA fee
trigger to $1,000, which will be adjusted
annually thereafter in accordance with
§ 1026.32(a)(1)(ii) as amended by the
2013 HOEPA Final Rule. Id. at 6968.
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II. Adjustment and Commentary
Revision
A. CARD Act Annual Adjustments
Minimum Interest Charge Disclosure
Thresholds—§§ 1026.6(b)(1)(ii) and
1026.60(b)(3)
The minimum interest charge
amounts for §§ 1026.6(b)(2)(iii) and
1026.60(b)(3) will remain unchanged for
the year 2014. Accordingly, the Bureau
is not amending these sections.
Penalty Fees Safe Harbor—
§ 1026.52(b)(1)(ii)(A) and (B)
Effective January 1, 2014, the
permissible fee threshold amounts are
$26 for § 1026.52(b)(1)(ii)(A) and $37 for
§ 1026.52(b)(1)(ii)(B). Accordingly, the
Bureau is revising § 1026.52(b)(1)(ii)(A)
and (B) to state that the fee imposed for
violating the terms or other
requirements of an account shall not
exceed $26 and $37 respectively. The
Bureau is also adopting new comment
52(b)(1)(ii)–2.i to preserve a list of the
historical thresholds for this provision.
B. HOEPA Annual Threshold
Adjustment—Comment 32(a)(1)(ii)–2
Effective January 1, 2014, for purposes
of determining whether a consumer
credit transaction that is secured by a
consumer’s principal dwelling and is
not otherwise exempt is covered by
§ 1026.32 (based on the total points and
fees payable by the consumer at
consummation), a loan is covered if the
points and fees exceed $632 or 8 percent
of the total loan amount, whichever is
greater. Comment 32(a)(1)(ii)–2, which
lists the adjustments for each year, is
amended to reflect the new dollar
threshold amount for 2014.
III. Administrative Law Matters
A. Administrative Procedure Act
Under the Administrative Procedure
Act, notice and opportunity for public
comment are not required if the Bureau
finds that notice and public comment
are impracticable, unnecessary, or
contrary to the public interest. 5 U.S.C.
553(b). The amendments in this notice
are technical and non-discretionary, and
they apply the method previously
established in the agency’s regulations
for determining adjustments to the
thresholds. For these reasons, the
Bureau has determined that publishing
a notice of proposed rulemaking and
providing opportunity for public
comment are unnecessary. Therefore,
the amendments are adopted in final
form.
Section 553(d) of the Administrative
Procedure Act generally requires
publication of a final rule not less than
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Federal Register / Vol. 78, No. 241 / Monday, December 16, 2013 / Rules and Regulations
30 days before its effective date, except
for (1) a substantive rule which grants
or recognizes an exemption or relieves
a restriction; (2) interpretive rules and
statements of policy; or (3) as otherwise
provided by the agency for good cause
found and published with the rule. 5
U.S.C. 553(d). At a minimum, the
Bureau believes the amendments fall
under the third exception to section
553(d). The Bureau finds that there is
good cause to make the amendments
effective on January 1, 2014. The
amendments in this notice are technical
and non-discretionary, and they apply
the method previously established in
the agency’s regulations for determining
adjustments to the thresholds.
B. Regulatory Flexibility Act
Because no notice of proposed
rulemaking is required, the Regulatory
Flexibility Act does not require an
initial or final regulatory flexibility
analysis. 5 U.S.C. 603(a), 604(a).
C. Paperwork Reduction Act
In accordance with the Paperwork
Reduction Act of 1995 (44 U.S.C. 3506;
5 CFR 1320), the agency reviewed this
final rule. No collections of information
pursuant to the Paperwork Reduction
Act are contained in the final rule.
List of Subjects in 12 CFR Part 1026
Advertising, Consumer protection,
Credit, Credit unions, Mortgages,
National banks, Reporting and
recordkeeping requirements, Savings
associations, Truth in lending.
Authority and Issuance
For the reasons set forth in the
preamble, the Bureau amends
Regulation Z, 12 CFR part 1026, as set
forth below:
(b)(1)(ii)(A) of this section for a violation
of the same type that occurred during
the same billing cycle or one of the next
six billing cycles; or
*
*
*
*
*
3. In Supplement I to part 1026—
Official Interpretations:
■ A. Under Section 1026.32—
Requirements for Certain Closed-End
Home Mortgages, 32(a) Coverage,
Paragraph 32(a)(1)(ii), paragraph 2.xix is
added.
■ B. Under Section 1026.52—
Limitations on Fees, 52(b) Limitations
on Penalty Fees, 52(b)(1)(ii) Safe
Harbors, subheading i and paragraph
2.i.A are added.
The additions read as follows:
■
SUPPLEMENT I TO PART 1026—
OFFICIAL INTERPRETATIONS
*
*
*
*
Section 1026.52—Limitations on Fees
52(b)(1)(ii)
Subpart G—Special Rules Applicable
to Credit Card Accounts and Open End
Credit Offered to College Students
2. Section 1026.52(b)(1)(ii)(A) and (B)
is revised to read as follows:
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*
32(a) Coverage.
*
*
*
*
Paragraph 32(a)(1)(ii).
*
*
*
*
*
2. Annual adjustment of $400
amount. * * *
xix. For 2014, $632, reflecting a 1.1
percent increase in the CPI–U from June
2012 to June 2013, rounded to the
nearest whole dollar.
*
*
*
*
*
Authority: 12 U.S.C. 2601, 2603–2605,
2607, 2609, 2617, 5511, 5512, 5532, 5581; 15
U.S.C. 1601 et seq.
Limitations on fees.
*
*
*
*
*
*
*
(b * * *
(1) * * *
(ii) * * *
(A) $26;
(B) $37 if the card issuer previously
imposed a fee pursuant to paragraph
*
Section 1026.32—Requirements for
Certain Closed-End Home Mortgages
1. The authority citation for part 1026
continues to read as follows:
*
*
Subpart E—Special Rules for Certain
Home Mortgage Transactions
■
§ 1026.52
*
Subpart G—Special Rules Applicable
to Credit Card Accounts and Open-End
Credit Offered to College Students
PART 1026—TRUTH IN LENDING
(REGULATION Z)
■
*
*
*
*
*
Safe harbors
*
*
*
*
*
2. Adjustments based on Consumer
Price Index. * * *
i. Historical thresholds.
A. Card issuers were permitted to
impose a fee for violating the terms of
an agreement if the fee did not exceed
$25 under § 1026.52(b)(1)(ii)(A) and $35
under § 1026.52(b)(1)(ii)(B), through
December 31, 2013.
Richard Cordray,
Director, Bureau of Consumer Financial
Protection.
[FR Doc. 2013–29844 Filed 12–13–13; 8:45 am]
BILLING CODE 4810–AM–P
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76035
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
14 CFR Part 39
[Docket No. FAA–2013–0725; Directorate
Identifier 98–CE–01–AD; Amendment 39–
17690; AD 98–15–18 R1]
RIN 2120–AA64
Airworthiness Directives; Maule
Aerospace Technology, Inc. Airplanes
Federal Aviation
Administration (FAA), DOT.
ACTION: Final rule.
AGENCY:
We are revising Airworthiness
Directive (AD) 98–15–18 that applies to
certain Maule Aerospace Technology,
Inc. Models M–4, M–5, M–6, M–7, MT–
7, MX–7, MXT–7, and M–8 airplanes
that are equipped with rear wing lift
struts, part number (P/N) 2079E, and/or
front wing lift struts, P/N 2080E. AD 98–
15–18 required repetitively inspecting
certain wing lift struts for internal
corrosion and replacing of any wing lift
strut where corrosion was found. Since
we issued AD 98–15–18, we were
informed by the manufacturer that
Model MXT–7–420 airplanes are no
longer in existence, are no longer type
certificated, and should be removed
from the Applicability section. We were
also informed that paragraph (b) in AD
98–15–18 had been misinterpreted and
caused confusion. This AD removes
Model MXT–7–420 airplanes from the
Applicability section and clarifies the
intent of the language in paragraph (b)
of AD 98–15–18. This AD also retains
all other requirements of AD 98–15–18.
We are issuing this AD to correct the
unsafe condition on these products.
DATES: This AD is effective January 21,
2014.
The Director of the Federal Register
approved the incorporation by reference
of a certain publication listed in this AD
as of January 26, 1996 (61 FR 623,
January 9, 1996).
ADDRESSES: For service information
identified in this AD, contact Maule Air,
Inc., 2099 GA Hwy 133 South, Moultrie,
Georgia 31768; telephone: (229) 985–
2045; fax: (229) 890–2402; Internet:
https://www.mauleairinc.com/pdf/
servicebulletins/service_bulletin_11_
old.pdf. You may review copies of the
referenced service information at the
FAA, Small Airplane Directorate, 901
Locust, Kansas City, Missouri 64106.
For information on the availability of
this material at the FAA, call (816) 329–
4148.
SUMMARY:
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Agencies
[Federal Register Volume 78, Number 241 (Monday, December 16, 2013)]
[Rules and Regulations]
[Pages 76033-76035]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-29844]
=======================================================================
-----------------------------------------------------------------------
BUREAU OF CONSUMER FINANCIAL PROTECTION
12 CFR Part 1026
Truth in Lending (Regulation Z)
AGENCY: Bureau of Consumer Financial Protection.
ACTION: Final rule; official interpretation.
-----------------------------------------------------------------------
SUMMARY: The Bureau of Consumer Financial Protection (Bureau) is
publishing this final rule amending the regulatory text and official
interpretations for Regulation Z, which implements the Truth in Lending
Act (TILA). The Bureau is required to calculate annually the dollar
amounts for several provisions in Regulation Z; this final rule reviews
the dollar amounts for provisions implementing amendments to TILA under
the Credit Card Accountability Responsibility and Disclosure Act of
2009 (CARD Act) and the Home Ownership and Equity Protection Act of
1994 (HOEPA). These amounts are adjusted, where appropriate, based on
the annual percentage change reflected in the Consumer Price Index in
effect on June 1, 2013. The minimum interest charge disclosure
thresholds will remain unchanged in 2014. The adjusted dollar amount
for the penalty fees safe harbor in 2014 is $26 for a first late
payment and $37 for each subsequent violation within the following six
months. The adjusted statutory fee trigger for HOPEA loans is $632,
effective January 1, 2014.
DATES: This final rule is effective January 1, 2014.
FOR FURTHER INFORMATION CONTACT: David Friend, Counsel, Office of
Regulations, Consumer Financial Protection Bureau, 1700 G Street NW.,
Washington, DC 20552 at (202) 435-7700.
SUPPLEMENTARY INFORMATION:
I. Background
A. CARD Act Annual Adjustments
In 2010, the Board of Governors of the Federal Reserve System
(Board) published amendments to Regulation Z implementing the Credit
Card Accountability Responsibility and Disclosure Act of 2009 (CARD
Act), which amended the Truth in Lending Act (TILA). Public Law 111-24,
123 Stat. 1734 (2009). Pursuant to the CARD Act, the Board's Regulation
Z amendments established new requirements with respect to open-end
consumer credit plans, including requirements for the disclosure of
minimum interest charge amounts and the establishment of a safe harbor
provision allowing card issuers to impose penalty fees for violating
account terms without violating the restrictions on penalty fees
established by the CARD Act. See 75 FR 7658, 7799 (Feb. 22, 2010) and
75 FR 37526, 37527 (June 29, 2010). The final rule issued by the Board
required that these thresholds be calculated annually using the
Consumer Price Index as published by the Bureau of Labor Statistics.\1\
---------------------------------------------------------------------------
\1\ The responsibility for promulgating rules under TILA was
transferred from the Board to the Bureau effective July 21, 2011.
The Bureau restated Regulation Z on December 22, 2011, and the
Bureau's Regulation Z is located at 12 CFR part 1026. 76 FR 79768
(Dec. 22, 2011). See sections 1061 and 1100A of the Dodd-Frank Wall
Street Reform and Consumer Protection Act (Dodd-Frank Act), Public
Law 11-203, 124 Stat. 1376 (2010). Section 1029 of the Dodd-Frank
Act excludes from this transfer of authority, subject to certain
exceptions, any rulemaking authority over a motor vehicle dealer
that is predominantly engaged in the sale and servicing of motor
vehicles, the leasing and servicing of motor vehicles, or both.
---------------------------------------------------------------------------
Minimum Interest Charge Disclosure Thresholds
Sections 1026.6(b)(2)(iii) and 1026.60(b)(3) of the Bureau's
Regulation Z provide that the minimum interest charge thresholds will
be re-calculated annually using the Consumer Price Index for Urban Wage
Earners and Clerical Workers (CPI-W) that was in effect on the
preceding June 1. When the cumulative change in the adjusted minimum
value derived from applying the annual CPI-W level to the current
amounts in Sec. Sec. 1026.6(b)(2)(iii) and 1026.60(b)(3) has risen by
a whole dollar, the minimum interest charge amounts set forth in the
regulation will be increased by $1.00. The Bureau of Labor Statistics
publishes consumer-based indices monthly, but does not report a CPI
change on June 1; adjustments are reported in the middle of the month.
The CPI-W is a subset of the CPI-U index (based on all urban consumers)
and represents approximately 28 percent of the U.S. population. The
adjustment reflects a 0.9 percent increase in the CPI-W from April 2012
to April 2013 and is rounded to the nearest $1 increment. This increase
in the CPI-W when applied to the current amounts in Sec. Sec.
1026.6(b)(2)(iii) and 1026.60(b)(3) did not trigger an increase in the
minimum interest charge threshold of at least
[[Page 76034]]
$1.00, and therefore the Bureau is not amending Sec. Sec.
1026.6(b)(2)(iii) and 1026.60(b)(3).
Penalty Fees Safe Harbor
The Bureau's Regulation Z provides that the safe harbor provision
which establishes the permissible fee thresholds in Sec.
1026.52(b)(1)(ii)(A) and (B) will be re-calculated annually using the
CPI-W that was in effect on the preceding June 1. This adjustment is
based on the CPI-W index in effect on June 1, 2013, which was reported
on May 16, 2013. The Bureau of Labor Statistics publishes consumer-
based indices monthly, but does not report a CPI change on June 1;
adjustments are reported in the middle of the month. The CPI-W is a
subset of the CPI-U index (based on all urban consumers) and represents
approximately 28 percent of the U.S. population. When the cumulative
change in the adjusted minimum value derived from applying the annual
CPI-W level to the current amounts in Sec. 1026.52(b)(1)(ii)(A) and
(B) has risen by a whole dollar, those amounts will be increased by
$1.00. Similarly, when the cumulative change in the adjusted minimum
value derived from applying the annual CPI-W level to the current
amounts in Sec. 1026.52(b)(1)(ii)(A) and (B) has decreased by a whole
dollar, those amounts will be decreased by $1.00. See comment
52(b)(1)(ii)-2. The adjustment to the permissible fee thresholds being
adopted here reflects a 0.9 percent increase in the CPI-W from April
2012 to April 2013 and is rounded to the nearest $1 increment.
B. HOEPA Annual Threshold Adjustment
In 1995, the Board of Governors of the Federal Reserve System
(Board) published amendments to Regulation Z implementing the Home
Ownership and Equity Protection Act of 1994 (HOEPA), which amended TILA
and was contained in the Riegle Community Development and Regulatory
Improvement Act of 1994, Public Law 103-325, 108 Stat. 2160. These
amendments impose substantive limitations and additional disclosure
requirements on certain closed-end home mortgage loans bearing annual
percentage rates or points and fees above a certain percentage or
amount. As enacted, the statute requires creditors to comply with the
HOEPA requirements if the total points and fees payable by the consumer
at consummation exceed the greater of $400 or 8 percent of the total
loan amount. TILA and Regulation Z provide that the $400 figure shall
be adjusted annually on January 1 by the annual percentage change in
the Consumer Price Index (CPI) that was reported on the preceding June
1. 15 U.S.C. 1602(bb)(3); 12 CFR 1026.32(a)(1)(ii).
The Bureau uses the Consumer Price Index for All Urban Consumers
(CPI-U) index, as published by the Bureau of Labor Statistics (BLS), as
the index for adjusting the $400 figure. The CPI-U is based on all
urban consumers and represents approximately 88 percent of the U.S.
population, The BLS publishes consumer-based indices monthly, but does
not report a CPI change on June 1; adjustments are reported in the
middle of each month. The adjustment to the CPI-U index reported by BLS
on May 16, 2013, was the CPI-U index in effect on June 1, and reflects
the percentage change from April 2012 to April 2013. The adjustment to
the $400 figure being adopted here reflects a 1.1 percent increase in
the CPI-U index for this period and is rounded to whole dollars for
ease of compliance.
The fee trigger being adjusted in this Federal Register notice
pursuant to TILA section 103(bb) is used in determining whether a loan
is covered by Sec. 1026.32. Such loans have generally been known as
``HOEPA loans.'' On January 10, 2013, the Bureau issued a final rule
pursuant to, inter alia, section 1431 of the Dodd-Frank Act, which
revised the statutory fee trigger for HOEPA loans. 78 FR 6856 (Jan. 31,
2013) (2013 HOEPA Final Rule). The amendments adopted in the 2013 HOEPA
Final Rule, including the revised fee trigger, apply to loans for which
the creditor received an application on or after January 10, 2014. Id.
at 6939. The Bureau is mindful of the need to coordinate implementation
of this final rule with the effective date of the January 10th final
rule adopting revisions to the HOEPA fee trigger. Accordingly, the
adjustment to the fee trigger that is being published today will become
effective on January 1, 2014, will apply to loans consummated on or
after January 1, 2014, and will apply until the revised HOEPA fee
trigger takes effect. Pursuant to section 1431 of the Dodd Frank Act
and Sec. 1026.32(a)(1)(ii) as amended by the 2013 HOEPA Final Rule,
implementation of the 2013 HOEPA Final Rule will change the HOEPA fee
trigger to $1,000, which will be adjusted annually thereafter in
accordance with Sec. 1026.32(a)(1)(ii) as amended by the 2013 HOEPA
Final Rule. Id. at 6968.
II. Adjustment and Commentary Revision
A. CARD Act Annual Adjustments
Minimum Interest Charge Disclosure Thresholds--Sec. Sec.
1026.6(b)(1)(ii) and 1026.60(b)(3)
The minimum interest charge amounts for Sec. Sec.
1026.6(b)(2)(iii) and 1026.60(b)(3) will remain unchanged for the year
2014. Accordingly, the Bureau is not amending these sections.
Penalty Fees Safe Harbor--Sec. 1026.52(b)(1)(ii)(A) and (B)
Effective January 1, 2014, the permissible fee threshold amounts
are $26 for Sec. 1026.52(b)(1)(ii)(A) and $37 for Sec.
1026.52(b)(1)(ii)(B). Accordingly, the Bureau is revising Sec.
1026.52(b)(1)(ii)(A) and (B) to state that the fee imposed for
violating the terms or other requirements of an account shall not
exceed $26 and $37 respectively. The Bureau is also adopting new
comment 52(b)(1)(ii)-2.i to preserve a list of the historical
thresholds for this provision.
B. HOEPA Annual Threshold Adjustment--Comment 32(a)(1)(ii)-2
Effective January 1, 2014, for purposes of determining whether a
consumer credit transaction that is secured by a consumer's principal
dwelling and is not otherwise exempt is covered by Sec. 1026.32 (based
on the total points and fees payable by the consumer at consummation),
a loan is covered if the points and fees exceed $632 or 8 percent of
the total loan amount, whichever is greater. Comment 32(a)(1)(ii)-2,
which lists the adjustments for each year, is amended to reflect the
new dollar threshold amount for 2014.
III. Administrative Law Matters
A. Administrative Procedure Act
Under the Administrative Procedure Act, notice and opportunity for
public comment are not required if the Bureau finds that notice and
public comment are impracticable, unnecessary, or contrary to the
public interest. 5 U.S.C. 553(b). The amendments in this notice are
technical and non-discretionary, and they apply the method previously
established in the agency's regulations for determining adjustments to
the thresholds. For these reasons, the Bureau has determined that
publishing a notice of proposed rulemaking and providing opportunity
for public comment are unnecessary. Therefore, the amendments are
adopted in final form.
Section 553(d) of the Administrative Procedure Act generally
requires publication of a final rule not less than
[[Page 76035]]
30 days before its effective date, except for (1) a substantive rule
which grants or recognizes an exemption or relieves a restriction; (2)
interpretive rules and statements of policy; or (3) as otherwise
provided by the agency for good cause found and published with the
rule. 5 U.S.C. 553(d). At a minimum, the Bureau believes the amendments
fall under the third exception to section 553(d). The Bureau finds that
there is good cause to make the amendments effective on January 1,
2014. The amendments in this notice are technical and non-
discretionary, and they apply the method previously established in the
agency's regulations for determining adjustments to the thresholds.
B. Regulatory Flexibility Act
Because no notice of proposed rulemaking is required, the
Regulatory Flexibility Act does not require an initial or final
regulatory flexibility analysis. 5 U.S.C. 603(a), 604(a).
C. Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
3506; 5 CFR 1320), the agency reviewed this final rule. No collections
of information pursuant to the Paperwork Reduction Act are contained in
the final rule.
List of Subjects in 12 CFR Part 1026
Advertising, Consumer protection, Credit, Credit unions, Mortgages,
National banks, Reporting and recordkeeping requirements, Savings
associations, Truth in lending.
Authority and Issuance
For the reasons set forth in the preamble, the Bureau amends
Regulation Z, 12 CFR part 1026, as set forth below:
PART 1026--TRUTH IN LENDING (REGULATION Z)
0
1. The authority citation for part 1026 continues to read as follows:
Authority: 12 U.S.C. 2601, 2603-2605, 2607, 2609, 2617, 5511,
5512, 5532, 5581; 15 U.S.C. 1601 et seq.
Subpart G--Special Rules Applicable to Credit Card Accounts and
Open End Credit Offered to College Students
0
2. Section 1026.52(b)(1)(ii)(A) and (B) is revised to read as follows:
Sec. 1026.52 Limitations on fees.
* * * * *
(b * * *
(1) * * *
(ii) * * *
(A) $26;
(B) $37 if the card issuer previously imposed a fee pursuant to
paragraph (b)(1)(ii)(A) of this section for a violation of the same
type that occurred during the same billing cycle or one of the next six
billing cycles; or
* * * * *
0
3. In Supplement I to part 1026--Official Interpretations:
0
A. Under Section 1026.32--Requirements for Certain Closed-End Home
Mortgages, 32(a) Coverage, Paragraph 32(a)(1)(ii), paragraph 2.xix is
added.
0
B. Under Section 1026.52--Limitations on Fees, 52(b) Limitations on
Penalty Fees, 52(b)(1)(ii) Safe Harbors, subheading i and paragraph
2.i.A are added.
The additions read as follows:
SUPPLEMENT I TO PART 1026--OFFICIAL INTERPRETATIONS
* * * * *
Subpart E--Special Rules for Certain Home Mortgage Transactions
* * * * *
Section 1026.32--Requirements for Certain Closed-End Home Mortgages
32(a) Coverage.
* * * * *
Paragraph 32(a)(1)(ii).
* * * * *
2. Annual adjustment of $400 amount. * * *
xix. For 2014, $632, reflecting a 1.1 percent increase in the CPI-U
from June 2012 to June 2013, rounded to the nearest whole dollar.
* * * * *
Subpart G--Special Rules Applicable to Credit Card Accounts and
Open-End Credit Offered to College Students
Section 1026.52--Limitations on Fees
* * * * *
52(b)(1)(ii) Safe harbors
* * * * *
2. Adjustments based on Consumer Price Index. * * *
i. Historical thresholds.
A. Card issuers were permitted to impose a fee for violating the
terms of an agreement if the fee did not exceed $25 under Sec.
1026.52(b)(1)(ii)(A) and $35 under Sec. 1026.52(b)(1)(ii)(B), through
December 31, 2013.
Richard Cordray,
Director, Bureau of Consumer Financial Protection.
[FR Doc. 2013-29844 Filed 12-13-13; 8:45 am]
BILLING CODE 4810-AM-P