15 U.S.C. § 1649 — Certain limitations on liability

Page 1531 TITLE 15—COMMERCE AND TRADE § 1649 ceives the disclosure required under section 1637a(a) of this title and the pamphlet required under section 1637a(e) of this title with respect to such application. (2) Constructive receipt For purposes of determining when a non- refundable fee may be imposed in accordance with this subsection if the disclosures and pamphlet referred to in paragraph (1) are mailed to the consumer, the date of the re- ceipt of the disclosures by such consumer shall be deemed to be 3 business days after the date of mailing by the creditor. (Pub. L. 90–321, title I, § 137, as added Pub. L. 100–709, § 3, Nov. 23, 1988, 102 Stat. 4731; amended Pub. L. 103–325, title I, § 154(c), Sept. 23, 1994, 108 Stat. 2197; Pub. L. 111–203, title X, § 1100A(2), July 21, 2010, 124 Stat. 2107.) Editorial Notes AMENDMENTS 2010—Subsec. (c)(4)(B). Pub. L. 111–203 substituted ‘‘Bureau’’ for ‘‘Board’’ in heading and text. 1994—Subsec. (b). Pub. L. 103–325 inserted at end ‘‘This subsection does not apply to reverse mortgage transactions.’’ Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2010 AMENDMENT Amendment by Pub. L. 111–203 effective on the des- ignated transfer date, see section 1100H of Pub. L. 111–203, set out as a note under section 552a of Title 5, Government Organization and Employees. EFFECTIVE DATE For effective date of section, see Regulations; Effec- tive Date note below. REGULATIONS; EFFECTIVE DATE For provisions relating to promulgation of regula- tions to implement amendment by Pub. L. 100–709 [en- acting this section], and effective date of such amend- ment in connection with those regulations, see section 7 of Pub. L. 100–709, set out as a note under section 1637a of this title. § 1648. Reverse mortgages (a) In general In addition to the disclosures required under this subchapter, for each reverse mortgage, the creditor shall, not less than 3 days prior to con- summation of the transaction, disclose to the consumer in conspicuous type a good faith esti- mate of the projected total cost of the mortgage to the consumer expressed as a table of annual interest rates. Each annual interest rate shall be based on a projected total future credit exten- sion balance under a projected appreciation rate for the dwelling and a term for the mortgage. The disclosure shall include— (1) statements of the annual interest rates for not less than 3 projected appreciation rates and not less than 3 credit transaction periods, as determined by the Bureau, including— (A) a short-term reverse mortgage; (B) a term equaling the actuarial life ex- pectancy of the consumer; and (C) such longer term as the Bureau deems appropriate; and (2) a statement that the consumer is not ob- ligated to complete the reverse mortgage transaction merely because the consumer has received the disclosure required under this section or has signed an application for the re- verse mortgage. (b) Projected total cost In determining the projected total cost of the mortgage to be disclosed to the consumer under subsection (a), the creditor shall take into ac- count— (1) any shared appreciation or equity that the lender will, by contract, be entitled to re- ceive; (2) all costs and charges to the consumer, in- cluding the costs of any associated annuity that the consumer elects or is required to pur- chase as part of the reverse mortgage trans- action; (3) all payments to and for the benefit of the consumer, including, in the case in which an associated annuity is purchased (whether or not required by the lender as a condition of making the reverse mortgage), the annuity payments received by the consumer and fi- nanced from the proceeds of the loan, instead of the proceeds used to finance the annuity; and (4) any limitation on the liability of the con- sumer under reverse mortgage transactions (such as nonrecourse limits and equity con- servation agreements). (Pub. L. 90–321, title I, § 138, as added Pub. L. 103–325, title I, § 154(b), Sept. 23, 1994, 108 Stat. 2196; amended Pub. L. 111–203, title X, § 1100A(2), July 21, 2010, 124 Stat. 2107.) Editorial Notes AMENDMENTS 2010—Subsec. (a)(1). Pub. L. 111–203 substituted ‘‘Bu- reau’’ for ‘‘Board’’ in two places. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2010 AMENDMENT Amendment by Pub. L. 111–203 effective on the des- ignated transfer date, see section 1100H of Pub. L. 111–203, set out as a note under section 552a of Title 5, Government Organization and Employees. § 1649. Certain limitations on liability (a) Limitations on liability For any closed end consumer credit trans- action that is secured by real property or a dwelling, that is subject to this subchapter, and that is consummated before September 30, 1995, a creditor or any assignee of a creditor shall have no civil, administrative, or criminal liabil- ity under this subchapter for, and a consumer shall have no extended rescission rights under section 1635(f) of this title with respect to— (1) the creditor’s treatment, for disclosure purposes, of— (A) taxes described in section 1605(d)(3) of this title; (B) fees described in section 1605(e)(2) and (5) of this title; (C) fees and amounts referred to in the 3rd sentence of section 1605(a) of this title; or Page 1532 TITLE 15—COMMERCE AND TRADE § 1650 (D) borrower-paid mortgage broker fees re- ferred to in section 1605(a)(6) of this title; (2) the form of written notice used by the creditor to inform the obligor of the rights of the obligor under section 1635 of this title if the creditor provided the obligor with a prop- erly dated form of written notice published and adopted by the Bureau or a comparable written notice, and otherwise complied with all the requirements of this section regarding notice; or (3) any disclosure relating to the finance charge imposed with respect to the trans- action if the amount or percentage actually disclosed— (A) may be treated as accurate for pur- poses of this subchapter if the amount dis- closed as the finance charge does not vary from the actual finance charge by more than $200; (B) may, under section 1605(f)(2) of this title, be treated as accurate for purposes of section 1635 of this title; or (C) is greater than the amount or percent- age required to be disclosed under this sub- chapter. (b) Exceptions Subsection (a) shall not apply to— (1) any individual action or counterclaim brought under this subchapter which was filed before June 1, 1995; (2) any class action brought under this sub- chapter for which a final order certifying a class was entered before January 1, 1995; (3) the named individual plaintiffs in any class action brought under this subchapter which was filed before June 1, 1995; or (4) any consumer credit transaction with re- spect to which a timely notice of rescission was sent to the creditor before June 1, 1995. (Pub. L. 90–321, title I, § 139, as added Pub. L. 104–29, § 4(a), Sept. 30, 1995, 109 Stat. 273; amend- ed Pub. L. 104–208, div. A, title II, § 2107(a), Sept. 30, 1996, 110 Stat. 3009–402; Pub. L. 111–203, title X, § 1100A(2), July 21, 2010, 124 Stat. 2107.) Editorial Notes AMENDMENTS 2010—Subsec. (a)(2). Pub. L. 111–203 substituted ‘‘Bu- reau’’ for ‘‘Board’’. 1996—Subsec. (a). Pub. L. 104–208 substituted ‘‘For any closed end consumer credit transaction that is secured by real property or a dwelling, that is subject to this subchapter, and’’ for ‘‘For any consumer credit trans- action subject to this subchapter’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2010 AMENDMENT Amendment by Pub. L. 111–203 effective on the des- ignated transfer date, see section 1100H of Pub. L. 111–203, set out as a note under section 552a of Title 5, Government Organization and Employees. EFFECTIVE DATE OF 1996 AMENDMENT Pub. L. 104–208, div. A, title II, § 2107(b), Sept. 30, 1996, 110 Stat. 3009–402, provided that: ‘‘The amendment made by subsection (a) [amending this section] shall be effective as of September 30, 1995.’’ § 1650. Preventing unfair and deceptive private educational lending practices and elimi- nating conflicts of interest (a) Definitions As used in this section— (1) the term ‘‘cosigner’’— (A) means any individual who is liable for the obligation of another without compensa- tion, regardless of how designated in the contract or instrument with respect to that obligation, other than an obligation under a private education loan extended to consoli- date a consumer’s pre-existing private edu- cation loans; (B) includes any person the signature of which is requested as condition to grant credit or to forbear on collection; and (C) does not include a spouse of an indi- vidual described in subparagraph (A), the signature of whom is needed to perfect the security interest in a loan. (2) the term ‘‘covered educational institu- tion’’— (A) means any educational institution that offers a postsecondary educational degree, certificate, or program of study (including any institution of higher education); and (B) includes an agent, officer, or employee of the educational institution; (3) the term ‘‘gift’’— (A)(i) means any gratuity, favor, discount, entertainment, hospitality, loan, or other item having more than a de minimis mone- tary value, including services, transpor- tation, lodging, or meals, whether provided in kind, by purchase of a ticket, payment in advance, or reimbursement after the expense has been incurred; and (ii) includes an item described in clause (i) provided to a family member of an officer, employee, or agent of a covered educational institution, or to any other individual based on that individual’s relationship with the of- ficer, employee, or agent, if— (I) the item is provided with the knowl- edge and acquiescence of the officer, em- ployee, or agent; and (II) the officer, employee, or agent has reason to believe the item was provided be- cause of the official position of the officer, employee, or agent; and (B) does not include— (i) standard informational material re- lated to a loan, default aversion, default prevention, or financial literacy; (ii) food, refreshments, training, or infor- mational material furnished to an officer, employee, or agent of a covered edu- cational institution, as an integral part of a training session or through participation in an advisory council that is designed to improve the service of the private edu- cational lender to the covered educational institution, if such training or participa- tion contributes to the professional devel- opment of the officer, employee, or agent of the covered educational institution; (iii) favorable terms, conditions, and bor- rower benefits on a private education loan