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46388 Federal Register / Vol. 71, No.

156 / Monday, August 14, 2006 / Rules and Regulations

accrued energy for which future CFR part 226 (Supp. I)) interprets the statute, the Board finds that notice and
incentive payment may be made; and regulation, and provides guidance to public comment on the change are
(9) Maintain a record of each creditors in applying the regulation to unnecessary.
applicant’s accrued energy. specific transactions.
III. Regulatory Flexibility Analysis
* * * * * In 1995, the Board published
[FR Doc. 06–6925 Filed 8–10–06; 1:20 pm]
amendments to Regulation Z The Board certifies that this
implementing HOEPA, contained in the amendment will not have a substantial
Riegle Community Development and effect on regulated entities because the
Regulatory Improvement Act of 1994, only change is to raise the threshold for
Pub. L. 103–325, 108 Stat. 2160 (60 FR transactions requiring HOEPA
FEDERAL RESERVE SYSTEM 15463). These amendments, contained disclosures.
in §§ 226.32 and 226.34 of the
12 CFR Part 226 regulation, impose substantive List of Subjects
[Regulation Z; Docket No. R–1263] limitations and additional disclosure 12 CFR Part 226
requirements on certain closed–end
Truth in Lending home mortgage loans bearing rates or Advertising, Federal Reserve System,
fees above a certain percentage or Mortgages, Reporting and recordkeeping
AGENCY: Board of Governors of the amount. As enacted, the statute requires requirements, Truth in lending.
Federal Reserve System. creditors to comply with the HOEPA ■ For the reasons set forth in the
ACTION: Final rule; staff commentary. rules if the total points and fees payable preamble, the Board amends Regulation
by the consumer at or before loan Z, 12 CFR part 226, as set forth below:
SUMMARY: The Board is publishing a consummation exceed the greater of
final rule amending the staff $400 or 8 percent of the total loan PART 226—TRUTH IN LENDING
commentary that interprets the amount. TILA and Regulation Z provide (REGULATION Z)
requirements of Regulation Z (Truth in that the $400 figure shall be adjusted
Lending). The Board is required to annually on January 1 by the annual ■ 1. The authority citation for part 226
adjust annually the dollar amount that percentage change in the Consumer continues to read as follows:
triggers requirements for certain home Price Index (CPI) that was reported on Authority: 12 U.S.C. 3806; 15 U.S.C. 1604
mortgage loans bearing fees above a the preceding June 1. (15 U.S.C. and 1637(c)(5).
certain amount. The Home Ownership 1602(aa)(3) and 12 CFR 226.32(a)(1)(ii)).
and Equity Protection Act of 1994 The Board adjusted the $400 amount to ■ 2. In Supplement I to Part 226, under
(HOEPA) sets forth rules for home– $528 for the year 2006. Section 226.32–––Requirements for
secured loans in which the total points The Bureau of Labor Statistics Certain Closed–End Home Mortgages,
and fees payable by the consumer at or publishes consumer–based indices under Paragraph 32(a)(1)(ii), paragraph
before loan consummation exceed the monthly, but does not ‘‘report’’ a CPI 2. xii. is added.
greater of $400 or 8 percent of the total change on June 1; adjustments are SUPPLEMENT I TO PART 226–
loan amount. In keeping with the reported in the middle of each month. OFFICIAL STAFF INTERPRETATIONS
statute, the Board has annually adjusted The Board uses the CPI–U index, which
is based on all urban consumers and * * * * *
the $400 amount based on the annual
percentage change reflected in the represents approximately 87 percent of SUBPART E–SPECIAL RULES FOR
Consumer Price Index that is in effect the U.S. population, as the index for CERTAIN HOME MORTGAGE
on June 1. The adjusted dollar amount adjusting the $400 dollar figure. The TRANSACTIONS
for 2007 is $547. adjustment to the CPI–U index reported * * * * *
DATES: January 1, 2007. by the Bureau of Labor Statistics on May Section 226.32–Requirements for
15, 2006, was the CPI–U index ‘‘in Certain Closed–End Home Mortgages
FOR FURTHER INFORMATION CONTACT: effect’’ on June 1, and reflects the
Minh–Duc T. Le, Senior Attorney, 32(a) Coverage
percentage increase from April 2005 to
Division of Consumer and Community * * * * *
April 2006. The adjustment to the $400
Affairs, Board of Governors of the figure below reflects a 3.55 percent Paragraph 32(a)(1)(ii)
Federal Reserve System, at (202) 452– increase in the CPI–U index for this * * * * *
3667. For the users of period and is rounded to whole dollars 2. Annual adjustment of $400
Telecommunications Device for the Deaf for ease of compliance. amount.
(‘‘TDD’’) only, contact (202) 263–4869.
II. Adjustment and Commentary * * * * *
Revision xii. For 2007, $547, reflecting a 3.55
I. Background percent increase in the CPI–U from June
Effective January 1, 2007, for purposes
2005 to June 2006, rounded to the
The Truth in Lending Act (TILA; 15 of determining whether a home
nearest whole dollar.
U.S.C. 1601 – 1666j) requires creditors mortgage transaction is covered by 12
to disclose credit terms and the cost of CFR 226.32 (based on the total points * * * * *
consumer credit as an annual and fees payable by the consumer at or By order of the Board of Governors of the
percentage rate. The act requires before loan consummation), a loan is Federal Reserve System, acting through the
additional disclosures for loans secured covered if the points and fees exceed the Director of the Division of Consumer and
by a consumer’s home, and permits greater of $ 547 or 8 percent of the total Community Affairs under delegated
authority, August 9, 2006.
consumers to cancel certain transactions loan amount. Comment 32(a)(1)(ii)–2,
jlentini on PROD1PC65 with RULES

that involve their principal dwelling. which lists the adjustments for each Jennifer J. Johnson,
TILA is implemented by the Board’s year, is amended to reflect the dollar Secretary of the Board.
Regulation Z (12 CFR part 226). The adjustment for 2007. Because the timing [FR Doc. E6–13281 Filed 8–11–06; 8:45 am]
Board’s official staff commentary (12 and method of the adjustment is set by BILLING CODE 6210–01–S

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