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07.27.2020
Compliance: CFPB Issues 2021 Regulation Z Thresholds
The Consumer Financial Protection Bureau (CFPB) last week issued updated dollar amount thresholds in Regulation Z for the minimum interest charge, Credit Card penalty fee amounts HOEPA loans and Qualified Mortgages. These changes are effective Jan. 1, 2021.

The CFPB is required to calculate annually the dollar amounts for several provisions in Regulation Z.

The thresholds are:

Minimum interest charge will remain unchanged at $1;

Credit card penalty fees: The adjusted dollar amount in 2021 for the safe harbor for a first violation credit card penalty fee will remain unchanged at $29 and the adjusted dollar amount for the safe harbor for a subsequent violation penalty fee will also remain unchanged at $40;

HOEPA loans: The adjusted total loan amount threshold for high-cost mortgages in 2021 will increase to $22,052 and the adjusted points-and-fees dollar trigger for high-cost mortgages in 2021 will increase to $1,103;

Qualified mortgages under the ability-to-repay rule:

o The maximum thresholds for total points and fees in 2021 will be 3% of the total loan amount for a loan greater than or equal to $110,260;

o $3,308 for a loan amount greater than or equal to $66,156 but less than $110,260;

o 5% of the total loan amount for a loan greater than or equal to $22,052 but less than $66,156;

o $1,103 for a loan amount greater than or equal to $13,783 but less than $22,052; and

o 8% of the total loan amount for a loan amount less than $13,783.

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