(1) Act means the
Truth in Lending Act (15 U.S.C. 1601 et seq.).
(2) Advertisement means a commercial
message in any medium that promotes, directly or indirectly, a credit
transaction.
(3) (i) Application means
the submission of a consumer’s financial information for the purposes
of obtaining an extension of credit.
(ii) For transactions subject to section
1026.19(e), (f), or (g) of this part, an application consists of the
submission of the consumer’s name, the consumer’s income, the consumer’s
social security number to obtain a credit report, the property address,
an estimate of the value of the property, and the mortgage loan amount
sought.
(4) Billing cycle or cycle means the interval between
the days or dates of regular periodic statements. These intervals
shall be equal and no longer than a quarter of a year. An interval
will be considered equal if the number of days in the cycle does not
vary more than four days from the regular day or date of the periodic
statement.
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(5) Bureau means
the Bureau of Consumer Financial Protection.
(6) Business day means a day on
which the creditor’s offices are open to the public for carrying on
substantially all of its business functions. However, for purposes
of rescission under sections 1026.15 and 1026.23, and for purposes
of sections 1026.19(a)(1)(ii), 1026.19(a)(2), 1026.19(e)(1)(iii)(B),
1026.19(e)(1)(iv), 1026.19(e)(2)(i)(A), 1026.19(e)(4)(ii), 1026.19(f)(1)(ii),
1026.19(f)(1)(iii), 1026.20(e)(5), 1026.31, and 1026.46(d)(4), the
term means all calendar days except Sundays and the legal public holidays
specified in 5 U.S.C. 6103(a), such as New Year’s Day, the Birthday
of Martin Luther King, Jr., Washington’s Birthday, Memorial Day, Independence
Day, Labor Day, Columbus Day, Veterans Day, Thanksgiving Day, and
Christmas Day.
(7) Card issuer means a person that issues a credit card or that
person’s agent with respect to the card.
(8) Cardholder means a natural person
to whom a credit card is issued for consumer credit purposes, or a
natural person who has agreed with the card issuer to pay consumer
credit obligations arising from the issuance of a credit card to another
natural person. For purposes of section 1026.12(a) and (b), the term
includes any person to whom a credit card is issued for any purpose,
including business, commercial or agricultural use, or a person who
has agreed with the card issuer to pay obligations arising from the
issuance of such a credit card to another person.
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(9) Cash price means the price at
which a creditor, in the ordinary course of business, offers to sell
for cash property or service that is the subject of the transaction.
At the creditor’s option, the term may include the price of accessories,
services related to the sale, service contracts and taxes and fees
for license, title, and registration. The term does not include any
finance charge.
(10) Closed-end credit means consumer credit other than “open-end
credit” as defined in this section.
(11) Consumer means a cardholder
or natural person to whom consumer credit is offered or extended.
However, for purposes of rescission under sections 1026.15 and 1026.23,
the term also includes a natural person in whose principal dwelling
a security interest is or will be retained or acquired,
if that person’s ownership interest in the dwelling is or will be
subject to the security interest. For purposes of sections 1026.20(c)
through (e), 1026.36(c), 1026.39, and 1026.41, the term includes a
confirmed successor in interest.
(12) Consumer credit means credit
offered or extended to a consumer primarily for personal, family,
or household purposes.
(13) Consummation means the time that a consumer becomes contractually
obligated on a credit transaction.
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(14) Credit means the right to defer
payment of debt or to incur debt and defer its payment.
(15) (i) Credit card means any card, plate, or other single credit device
that may be used from time to time to obtain credit. The term credit
card includes a hybrid prepaid-credit card as defined in section 1026.61.
(ii) Credit card
account under an open-end (not home-secured) consumer credit plan means any open-end credit account that is accessed by a credit card,
except:
(A) A home-equity plan subject to the requirements
of section 1026.40 that is accessed by a credit card;
(B) An overdraft line of credit
that is accessed by a debit card; or
(C) An overdraft line of credit that is accessed
by an account number, except if the account number is a hybrid prepaid-credit
card that can access a covered separate credit feature as defined
in section 1026.61.
(iii) Charge card means a credit
card on an account for which no periodic rate is used to compute a
finance charge.
(iv) Debit card means any card, plate, or other single device
that may be used from time to time to access an asset account other
than a prepaid account as defined in section 1026.61. The term debit card does not include a prepaid card as defined in section
1026.61.
(16) Credit sale means a sale in which the seller is a creditor.
The term includes a bailment or lease (unless terminable without penalty
at any time by the consumer) under which the consumer:
(i) Agrees
to pay as compensation for use a sum substantially equivalent to,
or in excess of, the total value of the property and service involved;
and
(ii) Will become
(or has the option to become), for no additional consideration or
for nominal consideration, the owner of the property upon compliance
with the agreement.
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(17) Creditor means:
(i) A person
who regularly extends consumer credit that is subject to a finance
charge or is payable by written agreement in more than four installments
(not including a down payment), and to whom the obligation is initially
payable, either on the face of the note or contract, or by agreement
when there is no note or contract.
(ii) For purposes of sections 1026.4(c)(8)
(Discounts), 1026.9(d) (Finance charge imposed at time of transaction),
and 1026.12(e) (Prompt notification of returns and crediting of refunds),
a person that honors a credit card.
(iii) For purposes of subpart B, any
card issuer that extends either open-end credit or credit that is
not subject to a finance charge and is not payable by written agreement
in more than four installments.
(iv) For purposes of subpart B (except
for the credit and charge card disclosures contained in sections 1026.60
and 1026.9(e) and (f), the finance charge disclosures contained in
section 1026.6(a)(1) and (b)(3)(i) and section 1026.7(a)(4) through
(7) and (b)(4) through (6) and the right of rescission set forth in
section 1026.15) and subpart C, any card issuer that extends closed-end
credit that is subject to a finance charge or is payable by written
agreement in more than four installments.
(v) A person regularly extends consumer
credit only if it extended credit (other than credit subject to the
requirements of section 1026.32) more than 25 times (or more than
5 times for transactions secured by a dwelling) in the preceding calendar
year. If a person did not meet these numerical standards in the preceding
calendar year, the numerical standards shall be applied to the current
calendar year. A person regularly extends consumer credit if, in any
12-month period, the person originates more than one credit extension
that is subject to the requirements of section 1026.32 or one or more
such credit extensions through a mortgage broker.
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(18) Downpayment means
an amount, including the value of property used as a trade-in, paid
to a seller to reduce the cash price of goods or services purchased
in a credit sale transaction. A deferred portion of a downpayment
may be treated as part of the downpayment if it is payable not later
than the due date of the second otherwise regularly scheduled payment
and is not subject to a finance charge.
(19) Dwelling means a residential
structure that contains one to four units, whether or not that structure
is attached to real property. The term includes an individual condominium
unit, cooperative unit, mobile home, and trailer, if it is used as
a residence.
(20) Open-end credit means consumer credit extended by a creditor
under a plan in which:
(i) The creditor reasonably contemplates
repeated transactions;
(ii) The creditor may impose a finance charge from time to time on
an outstanding unpaid balance; and
(iii) The amount of credit that may
be extended to the consumer during the term of the plan (up to any
limit set by the creditor) is generally made available to the extent
that any outstanding balance is repaid.
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(21) Periodic rate means a rate
of finance charge that is or may be imposed by a creditor on a balance
for a day, week, month, or other subdivision of a year.
(22) Person means a
natural person or an organization, including a corporation, partnership,
proprietorship, association, cooperative, estate, trust, or government
unit.
(23) Prepaid
finance charge means any finance charge paid separately in cash
or by check before or at consummation of a transaction, or withheld
from the proceeds of the credit at any time.
(24) Residential mortgage transaction means a transaction in which a mortgage, deed of trust, purchase
money security interest arising under an installment sales contract,
or equivalent consensual security interest is created or retained
in the consumer’s principal dwelling to finance the acquisition or
initial construction of that dwelling.
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(25) Security interest means an
interest in property that secures performance of a consumer credit
obligation and that is recognized by State or Federal law. It does
not include incidental interests such as interests in proceeds, accessions,
additions, fixtures, insurance proceeds (whether or not the creditor
is a loss payee or beneficiary), premium rebates, or interests in
after-acquired property. For purposes of disclosures under sections
1026.6, 1026.18, 1026.19(e) and (f), and 1026.38(l)(6), the
term does not include an interest that arises solely by operation
of law. However, for purposes of the right of rescission under sections
1026.15 and 1026.23, the term does include interests that arise solely
by operation of law.
(26) State means any state, the District of Columbia, the
Commonwealth of Puerto Rico, and any territory or possession of the
United States.
(27) (i) Successor in interest means a person to whom an ownership interest in a dwelling securing
a closed-end consumer credit transaction is transferred from a consumer,
provided that the transfer is:
(A) A transfer by devise, descent,
or operation of law on the death of a joint tenant or tenant by the
entirety;
(B) A transfer
to a relative resulting from the death of the consumer;
(C) A transfer where the spouse
or children of the consumer become an owner of the property;
(D) A transfer resulting from
a decree of a dissolution of marriage, legal separation agreement,
or from an incidental property settlement agreement, by which the
spouse of the consumer becomes an owner of the property; or
(E) A transfer into an inter
vivos trust in which the consumer is and remains a beneficiary
and which does not relate to a transfer of rights of occupancy in
the property.
(ii) Confirmed successor in interest means a successor in interest once a servicer has confirmed the
successor in interest’s identity and ownership interest in the dwelling.
(28) The Board-selected
benchmark replacement for consumer loans means the SOFR-based
index selected by the Board of Governors of the Federal Reserve System
to replace, as applicable, the 1-month, 3-month, 6-month, or 12-month
tenor of U.S. Dollar LIBOR, as set forth in the Board of Governors
of the Federal Reserve System’s regulation at 12 CFR part 253, which
implements the Adjustable Interest Rate (LIBOR) Act, Public Law 117-103,
division U.
