What: In December of 2008, the Federal Reserve Board issued final Regulation Z rules making significant changes to both the content and format of the open-end (not home-secured) lending disclosures effective July 1, 2010. However, on January 12, 2010, the Board issued final rules implementing those portions of the Credit CARD Act effective February 22, 2010. This January 2010 rule accelerated the effective date (to February 22, 2010) of a number of the Change-in-Terms and Advertising changes.
- Credit Card Application and Solicitation Disclosures
- Changes to both the format and the content of the key terms summary table commonly referred to as the “Schumer Box”
- Account-Opening Disclosures
- Certain key terms must be disclosed in a summary table at account opening
- Table is similar to the table required for the credit card application and solicitation disclosures
- Lenders need to revise both the format and content of the open-end account agreements
- Periodic Statements
- Significant revisions to the format and content of periodic statement disclosures
- The “effective” APR has been eliminated
- Payment amount due, late payment fee, and any penalty APR must be disclosed on the front side of the periodic statement
- Change-in-Terms Notices
- Notice must be provided at least 45 days prior to the change (eff. 2/22/2010)
- Notice required for a change in any term disclosed in the key terms table given at account opening (eff. 2//22/2010)
- Notice required for a rate increase resulting from a consumer’s default or delinquency (eff. 2/22/2010)
- If the change-in-terms notice accompanies a periodic statement, it must be provided in a tabular format on the front side of the periodic statement
- Advertising
- New disclosures for plans to finance the purchase of goods or services
- May only refer to a “fixed” rate in limited circumstances eff. 2/22/2010)
Effective: July 1, 2010
Solutions:
Wolters Kluwer Financial Services provides multiple products (for personal lines of credit and overdraft protection plans) that can meet your business needs for this regulatory change. These solutions include:
- Loan Origination Software solutions
- Print and Electronic document solutions
Loan Origination Software solutions: Wolters Kluwer Financial Services offers several Loan Origination Software product that provide a full array of documentation for consumer, real estate, and commercial lending. One of the features of these products is documentation for Open End Lending. Click here to request more information on these products and services.
Print and Electronic Document Solutions: Wolters Kluwer Financial Services offers their documents as a menu-driven, worksheet based product. This process provides a unique document that is tailored to the language and policy choices of each customer. These specific solutions include the following document options:
- Open End Credit Plan Personal Line (OCP-PL) – Disclosure and Agreement (print or electronic)
- Open End Credit Plan Personal Line for Credit Unions (OCP-PL) – Disclosure and Agreement (print or electronic)
- Open End Credit Plan Overdraft Line (OCP-OL) – Disclosure and Agreement (print or electronic)
- Open End Credit Plan Overdraft Line for Credit Unions (OCP-OL) – Disclosure and Agreement (print or electronic)
- Overdraft Protection Account Brochure (ODP-COMB-BRO) – Application, Disclosure, and Agreement (print)
- Personal Line of Credit Account Brochure (PCL-COMB-BRO) –Application, Disclosure and Agreement (print)
Click here to request more information on these products and services.
ComplianceHeadquarters™ article: Regulation Z Final Rule for Non-Home Equity Revolving Credit
