(a) Definitions. For the purposes of this part, the following definitions apply:

(1) Account has the same meaning as in Regulation E, 12 CFR 1005.2(b).

(2) Affiliate has the same meaning as in 12 U.S.C. 5481(1).

(3) Closed-end credit means an extension of credit to a consumer that is not open-end credit under paragraph (a)(16) of this section.

(4) Consumer has the same meaning as in 12 U.S.C. 5481(4).

(5) Consummation means the time that a consumer becomes contractually obligated on a new loan or a modification that increases the amount of an existing loan.

(6) Cost of credit means the cost of consumer credit as expressed as a per annum rate and is determined as follows:

(i) Charges included in the cost of credit. The cost of credit includes all finance charges as set forth by Regulation Z, 12 CFR 1026.4, but without regard to whether the credit is consumer credit, as that term is defined in 12 CFR 1026.2(a)(12), or is extended to a consumer, as that term is defined in 12 CFR 1026.2(a)(11).

(ii) Calculation of the cost of credit—

(A) Closed-end credit. For closed-end credit, the cost of credit must be calculated according to the requirements of Regulation Z, 12 CFR 1026.22.

(B) Open-end credit. For open-end credit, the cost of credit must be calculated according to the rules for calculating the effective annual percentage rate for a billing cycle as set forth in Regulation Z, 12 CFR 1026.14(c) and (d).

(7) Covered longer-term balloon-payment loan means a loan described in §1041.3(b)(2).

(8) Covered longer-term loan means a loan described in §1041.3(b)(3).

(9) [Reserved]

(10) Covered short-term loan means a loan described in §1041.3(b)(1).

(11) Credit has the same meaning as in Regulation Z, 12 CFR 1026.2(a)(14).

(12) Electronic fund transfer has the same meaning as in Regulation E, 12 CFR 1005.3(b).

(13) Lender means a person who regularly extends credit to a consumer primarily for personal, family, or household purposes.

(14) [Reserved]

(15) Motor vehicle means any self-propelled vehicle primarily used for on-road transportation. The term does not include motor homes, recreational vehicles, golf carts, and motor scooters.

(16) Open-end credit means an extension of credit to a consumer that is an open-end credit plan as defined in Regulation Z, 12 CFR 1026.2(a)(20), but without regard to whether the credit is consumer credit, as defined in 12 CFR 1026.2(a)(12), is extended by a creditor, as defined in 12 CFR 1026.2(a)(17), is extended to a consumer, as defined in 12 CFR 1026.2(a)(11), or permits a finance charge to be imposed from time to time on an outstanding balance as defined in 12 CFR 1026.4.

(17) Outstanding loan means a loan that the consumer is legally obligated to repay, regardless of whether the loan is delinquent or is subject to a repayment plan or other workout arrangement, except that a loan ceases to be an outstanding loan if the consumer has not made at least one payment on the loan within the previous 180 days.

(18) Service provider has the same meaning as in the Dodd-Frank Wall Street Reform and Consumer Protection Act, 12 U.S.C. 5481(26).

(19) [Reserved]

(b) Rule of construction. For purposes of this part, where definitions are incorporated from other statutes or regulations, the terms have the meaning and incorporate the embedded definitions, appendices, and commentary from those other laws except to the extent that this part provides a different definition for a parallel term.

[82 FR 54871, Nov. 17, 2017, as amended at 84 FR 27929, June 17, 2019; 85 FR 44444, July 22, 2020]