(a) Limitations on imposing finance charges as a result of the loss of a
grace period.
(1) General rule. Except as provided in paragraph (b) of this section, a card issuer must
not impose finance charges as a result of the loss of a grace period on a
credit card account under an open-end (not home-secured) consumer credit plan
if those finance charges are based on:
(i) Balances for days in billing cycles that precede the most recent
billing cycle; or
(ii) Any portion of a balance subject to a grace period that was repaid
prior to the expiration of the grace period.
(2) Definition of grace period. For purposes of paragraph (a)(1) of this section, “grace period” has
the same meaning as in section
1026.5(b)(2)(ii)(B)(3).
(b) Exceptions. Paragraph (a) of this section does not apply to:
(1) Adjustments to finance charges as a result of the resolution of a
dispute under section 1026.12 or section 1026.13; or
(2) Adjustments to finance charges as a result of the return of a
payment.
