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This Manual serves as a comprehensive resource for compliance
professionals, credit administrators, loan officers and loan documentation
specialists regarding all aspects of the Truth in Lending Act and Regulation Z.
Part One of SPM #18 includes a summary of recent developments during
2024-2026, including the 2026 adjustments to various thresholds under Regulation
Z (such as the asset threshold for small creditor QM and the Section 1026.3(b)
coverage exemption threshold), the CFPB’s final rule that applies ability-to-repay
(ATR) and disclosure requirements to Property Assessed Clean Energy (PACE)
transactions, and a glossary of defined terms under Regulation Z.
Part Two discusses general compliance requirements that affect both closed-end and open-end credit, including:
- Regulation Z’s coverage and exemption rules;
- Determining what is and is not a finance charge;
- Record retention requirements;
- APR and finance charge tolerances;
- Liability provisions under TILA (including a creditor’s liability for actual and statutory damages, assignee liability and the various statutes of limitations); and
- How to take corrective action (to cure a Regulation Z violation).
Part Three provides detailed discussions of Regulation Z’s closed-end credit
requirements, including (i) the form, timing, and contents of the TIL disclosure
statement provided at consummation for non-TRID loans, (ii) early disclosure rules
for reverse mortgages subject to RESPA and the applicable waiting periods, (iii) the
TRID rule, (iv) construction loan disclosures under Appendix D and the TRID rule,
(v) right of rescission, (vi) private education loans, (vii) advertising requirements,
and (viii) reverse mortgage transactions. Part Three also provides:
- In-depth discussions of the fundamentals regarding the TILA/RESPA
Integrated Disclosure (TRID) Rule, the page-by-page contents of the
Loan Estimate and the Closing Disclosure, including a discussion of
TRID 2.0 and how the TRID Rule applies to construction loans; and
- Details regarding the ability-to-repay rule, higher-priced mortgages
under Section 1026.35, high-cost mortgage (HOEPA) loans under
Section 1026.32, mortgage servicing rules (including periodic
statements for mortgage loans), ARM transactions, and loan
originator compensation and qualification requirements.
Part Four explains the open-end (revolving) credit requirements under Regulation Z, explaining the requirements governing:
- Account-opening disclosures;
- Periodic statements;
- Right of rescission;
- Home equity lines of credit;
- Special credit card rules under Section 1026.12 (such as the
unsolicited issuance of credit cards restrictions, liability of cardholders
for unauthorized use, and the right of cardholders to assert claims or
defenses against card issuers);
- Advertising requirements;
- Billing error resolution procedures;
- Complicated requirements regarding open-end change-in-terms notices;
- Special rules that apply only to credit card accounts;
- Special rules that apply to all types of open-end credit offered to college students; and
- Application of Regulation Z to hybrid prepaid-credit cards.
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COMPLIANCE COMPANION®
Compliance Companion® is a one-stop regulatory compliance resource for
financial institutions. This online compilation of 19 industry-leading compliance
manuals, including this SPM #18, Truth in Lending Act & Regulation Z, takes the
legalese out of federal and California laws and regulations, making it easier to
understand and keep up with ongoing compliance developments.
Published by Aldrich & Bonnefin, PLC, Compliance Companion® has many useful
features including search capabilities, links to internal cross-references and web-based sources, as well as samples of dozens of forms, disclosures and notices.
This compliance resource can also be accessed from your mobile device, making it
faster and easier to get the latest information on federal and California laws and
regulations governing financial institutions.
For information regarding online subscriptions to Compliance Companion®, contact
info@bankerscompliancegroup.com or call 949-553-0909.
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