US Supreme Court Decisions On-Line | US Laws

§ 3806. —  Adjustable rate mortgage caps.

[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
  January 24, 2002 and December 19, 2002]
[CITE: 12USC3806]

                       TITLE 12--BANKS AND BANKING
Sec. 3806. Adjustable rate mortgage caps

(a) In general

    Any adjustable rate mortgage loan originated by a creditor shall 
include a limitation on the maximum interest rate that may apply during 
the term of the mortgage loan.

(b) Regulations

    The Board of Governors of the Federal Reserve System shall prescribe 
regulations to carry out the purposes of this section.

(c) Enforcement

    Any violation of this section shall be treated as a violation of the 
Truth in Lending Act [15 U.S.C. 1601 et seq.] and shall be subject to 
administrative enforcement under section 108 [15 U.S.C. 1607] or civil 
damages under section 130 [15 U.S.C. 1640] of such Act, or both.

(d) Definitions

    For the purpose of this section--
        (1) the term ``creditor'' means a person who regularly extends 
    credit for personal, family, or household purposes; and
        (2) the term ``adjustable rate mortgage loan'' means any 
    consumer loan secured by a lien on a one- to four-family dwelling 
    unit, including a condominium unit, cooperative housing unit, or 
    mobile home, where the loan is made pursuant to an agreement under 
    which the creditor may, from time to time, adjust the rate of 

(e) Effective date

    This section shall take effect upon the expiration of 120 days after 
August 10, 1987.

(Pub. L. 100-86, title XII, Sec. 1204, Aug. 10, 1987, 101 Stat. 662; 
Pub. L. 102-550, title IX, Sec. 952, Oct. 28, 1992, 106 Stat. 3893.)

                       References in Text

    The Truth in Lending Act, referred to in subsec. (c), is title I of 
Pub. L. 90-321, May 29, 1968, 82 Stat. 146, as amended, which is 
classified generally to subchapter I (Sec. 1601 et seq.) of chapter 41 
of Title 15, Commerce and Trade. For complete classification of this Act 
to the Code, see Short Title note set out under section 1601 of Title 15 
and Tables.


    Section was enacted as part of the Competitive Equality Banking Act 
of 1987, and not as part of the Alternative Mortgage Transaction Parity 
Act of 1982 which comprises this chapter.


    1992--Subsec. (d)(2). Pub. L. 102-550 substituted ``any consumer 
loan'' for ``any loan''.

                  Section Referred to in Other Sections

    This section is referred to in title 15 section 1639.