Regulation Z - Truth in Lending
November 30, 2000
Circular No. 11290

Annual Adjustment Affecting Disclosure

To All Depository Institutions and Others Concerned in the Second Federal Reserve District:

The following is a statement issued November 21 by the Board of Governors of the Federal Reserve System:

The Federal Reserve Board today published its annual adjustment of the dollar amount that triggers additional disclosure requirements under the Truth in Lending Act for mortgage loans that bear rates or fees above a certain amount.

Under the revision to the Board's staff commentary to Regulation Z, the dollar amount of the fee-based trigger has been adjusted from $451 for 2000 to $465 for 2001 based on the annual percentage change reflected in the Consumer Price Index that was in effect on June 1, 2000.

The adjustment is effective January 1, 2001.

The Home Ownership and Equity Protection Act of 1994 bars credit terms such as balloon payments and requires additional disclosures when total points and fees payable by the consumer exceed $400 (to be adjusted annually) or 8 percent of the total loan amount, whichever is larger.

The Board's official notice of this action (pdf - 117kb) was published in the Federal Register of November 24, and is available. Questions on this matter may be directed, at this Bank, to Janice A. Oser, Bank Supervision Officer, Legal and Compliance Risk Department (212-720-8136).