District Circular Letters
District Circular Letters Index
February 12, 1998
REVISION OF DOLLAR AMOUNT
FOR DISCLOSURE REQUIREMENTS
PROPOSED STREAMLINING AND
REFORM
OF TILA AND RESPA
To Member and Nonmember Banks
and Others Concerned
in the Twelfth Federal Reserve District
Adjustment of Dollar Amount
Triggering Additional Disclosure (Docket
R-0998)
The Federal Reserve Board has published
its annual adjustment of the dollar amount that triggers additional disclosure
requirements under Truth in Lending for mortgage loans that bear fees
above a certain amount.
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 or 8 percent of the total loan amount, whichever is larger. The Board
must adjust this amount each year based on the annual percentage change
in the Consumer Price Index in effect on June 1.
The Board has adjusted the dollar
amount from $424 for 1997 to $435 for 1998, effective immediately.
Request for Additional Comment
on Proposed Legislative Action (Docket
R-0954)
The Federal Reserve Board has requested
additional comment on possible streamlining and reform of the Truth in
Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA)
for home-secured loans.
Comments are requested by March
9, 1998.
The Economic Growth and Regulatory
Paperwork Reduction Act of 1996 directed the Board and the Department
of Housing and Urban Development to submit legislative recommendations
to the Congress on how to simplify and improve consumer disclosures under
TILA and RESPA, if the disclosures could not be simplified by regulation.
In March 1997, the Board determined
that regulatory changes alone would be inadequate to achieve the goals
of the Congress and invited public comment on legislative changes to harmonize
the two Acts.
The Board is now reopening the comment
period to obtain additional views on matters such as the timing, content,
and reliability of disclosures, by inviting certain first-time homebuyers
and previous home purchasers to participate in focus groups. Comment from
other interested parties is also welcomed.
Copies
Copies of the Board's notices (Docket
R-0998 and Docket R-0954) are available from
our Corporate Services Department. To request copies to be sent via mail,
please call (415) 974-2748. To request copies to be sent
via fax, please call (415) 974-3333, and specify document
numbers 4188 and 4245, respectively.
Additional Information
For additional information regarding
Regulation Z, please contact our Banking Supervision and Regulation Department,
at (415) 974-2977.
FEDERAL RESERVE BANK
OF SAN FRANCISCO
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