The Federal Reserve Board and the Consumer Financial Protection Bureau on Tuesday announced increases in the dollar thresholds in Regulation Z (Truth in Lending) and Regulation M (Consumer Leasing) for exempt consumer credit and lease transactions.
The increases are consistent with the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) amendments to the Truth in Lending Act and the Consumer Leasing Act to adjust these thresholds annually by the annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers. Transactions at or below the thresholds are subject to the protections of the regulations.
Based on the adjustments announced, the protections of the Truth in Lending Act and the Consumer Leasing Act generally will apply to consumer credit transactions and consumer leases of $54,600 or less in 2015 - an increase of $1,100 from 2014. However, private education loans and loans secured by real property (such as mortgages) are subject to the Truth in Lending Act regardless of the amount of the loan.
The adjustments to the thresholds reflect the annual percentage increase in the consumer price index as of June 1, 2014 and will take effect on January 1, 2015.
Although the Dodd-Frank Act generally transferred rulemaking authority under the Truth in Lending Act and the Consumer Leasing Act to the CFPB, the Federal Reserve Board retains authority to issue rules for certain motor vehicle dealers. Therefore, the agencies are issuing these adjustments jointly.
The following notices will be published shortly in the Federal Register.
- Regulation M Notice: http://files.consumerfinance.gov/f/201409_cfpb_notice_threshold-adjustment_regulation-m.pdf
- Regulation Z Notice: http://files.consumerfinance.gov/f/201409_cfpb_notice_threshold-adjustment_regulation-z.pdf