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Regulation Z – Credit Card Fees

The Consumer Financial Protection Bureau (CFPB) has announced the 2022 safe harbor maximum fee amounts that may be imposed when a card holder violates the terms or other requirements of a credit card account [§1026.52(b)(1)(ii) of Regulation Z]. 

Some examples of fees to which the safe harbor amount applies are as follows

  • Late Payment Fees & Returned Payment Fees 
  • Over-The-Limit Fees 
  • Declined Transaction/Access Check Fees 
  • Account Inactivity Fees 
  • Fees To Close An Account 

The CFPB is required to adjust the safe harbor amounts each year based on changes in the Consumer Price Index. Effective January 1, 2022, the safe harbor amounts will be as follows:

  • $30 for the first violation 
  • $41 for subsequent violations of the same type during the next 6 billing cycles. 

Over time, the safe harbor amounts have changes as shown below:

Table of Violations

# Of the same type during the next 6 billing cycles.

* Originally reported as $37 but later corrected to $38.

Questions and Answers

Equal Housing

Question: Should the Equal Housing Logo be placed on all advertisements regardless of whether they are for loans or deposits?

Answer: The logo is to be used with housing related advertisements. There are size requirements for the logo or slogan based on the type of advertisement. As for use in all advertisements, using the logo in all the bank’s advertisements is not prohibited. Some banks prefer to use both the Housing logo and the Member FDIC on all advertisements. Always using both removes the question as to whether it is needed. One caveat, if using the logo for all advertisements, be sure to follow the requirements for size and placement to ensure compliance.

Reference: HUD 24 CFR 110 Subpart B.

Service Members Civil Relief Act

Question: When a spouse is on active duty and the insurance on the collateral, be it a home or a car, has been canceled, can collateral-placed insurance (CPI) be put on the loan? 

Answer: With the general public, when CPI is put on vehicles, the payment does go up, so the loan will mature correctly, and it is mentioned in the disclosures at loan signing. 

Question: When a mortgage has insurance added, it increases only the principal balance of the loan. Is this allowed on service member loans?

Answer: Bona fide insurance is excluded from the 6 percent cap because the SCRA does not define it as interest. With respect to this insurance and the practice you describe, other federal or state laws may apply.

Reference: Fed. Consumer Compliance Outlook, 1st Quarter 2013, as updated in Dec. 2015.