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To: Chief Executive Officers and Compliance Officers of All National banks and National Bank Operating Subsidiaries, Department and Division Heads, and All Examining Personnel

Description: Final Rule - Annual Dollar Trigger for Certain Home Mortgage Loans Bearing Fees Above a Certain Amount

The Federal Reserve Board published, in the August 7, 2007, Federal Register, its annual amendment to its Regulation Z Commentary related to the dollar amount that triggers requirements for certain home mortgage loans subject to 12 CFR 226.32. The Home Ownership and Equity Protection Act of 1994 established rules for home-secured loans in which the total points and fees payable by the consumer at or before loan closing exceed the greater of $400 or 8 percent of the total loan amount. The $400 amount is adjusted annually based on the annual percentage change in the Consumer Price Index that is in effect on June 1. The adjusted dollar amount for 2008 is $561.

Effective January 1, 2008, the 12 CFR 226.32 points and fees trigger is the greater of $561 or 8 percent of the total loan amount. This change can be found in the Regulation Z Commentary at 226.32(a)(1)(ii) – 2, which lists the annual adjustments.

Questions regarding this change may be directed to your supervisory office or the Compliance Policy Department at (202) 649-5470.

Ann F. Jaedicke
Deputy Comptroller for Compliance Policy

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