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U.S. Code as of:
01/19/04
Section 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 interest.
(e) Effective date
This section shall take effect upon the expiration of 120 days
after August 10, 1987.
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