CFPB Announces Updates TILA Fees, Thresholds for 2020
The Consumer Financial Protection Bureau (CFPB) has announced adjusted threshold amounts for several provisions in Regulation Z, which implements the Truth in Lending Act (TILA). The CFPB is required to calculate the dollar amounts for several provisions in Regulation Z annually.
The 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 (CARD) Act of 2009, the Home Ownership and Equity Protection Act of 1994 (HOEPA), and the Dodd-Frank Act.
Adjustments are made based on the annual percentage change reflected in the Consumer Price Index (CPI) in effect on June 1, 2019.
These revised thresholds, which will be effective January 1, 2020, include:
- For open-end consumer credit plans under TILA, the threshold that triggers requirements to disclose minimum interest charges will remain unchanged at $1.00 in 2020;
- For open-end consumer credit plans under the CARD Act amendments to TILA, the adjusted dollar amount in 2020 for the safe harbor for a first violation penalty fee will increase by $1 to $29 and the adjusted dollar amount for the safe harbor for a subsequent violation penalty fee will increase by $1 to $40;
- For HOEPA loans, the adjusted total loan amount threshold for high-cost mortgages in 2020 will be $21,980. The adjusted points-and-fees dollar trigger for high-cost mortgages in 2020 will be $1,099;
- For qualified mortgages, which provide creditors with certain protections from liability under the Ability-to-Repay Rule, the maximum thresholds for total points and fees in 2020 will be:
- 3% of the total loan amount for a loan greater than or equal to $109,898;
- $3,297 for a loan amount greater than or equal to $65,939 but less than $109,898;
- 5% of the total loan amount for a loan greater than or equal to $21,980 but less than $65,939;
- $1,099 for a loan amount greater than or equal to $13,737 but less than $21,980; and
- 8% of the total loan amount for a loan amount less than $13,737.