I know I need to give Reg Z restitution for an APR / Finance Charge error, but I don’t have a clue how much to give. HELP!

Answered by:

Rebekah Leonard | CRCM

Question:

We messed up an APR beyond Reg Z tolerance, and know we need to give the borrower restitution. But how do we figure out the right amount to give?!

Answer:

Good for you in 4/ that restitution is needed. Many banks never get this far. The first step is to check out the Agencies Joint Statement of Policy – from 1998! It outlines the restitution provisions that apply, giving you the framework you need to know. After looking it over, get thee over to the FFIEC’s APR Tool, which will be your best friend for getting the job done. It is a fantastic, reliable, (and official) tool that will guide you through the entire process, and produce a final report telling you exactly what amount is needed.

Join Rebekah Leonard at her upcoming webinar “Yikes! The APR or APY is WRONG…Now What?!” on May 18, 2023 to practice using the APR Tool with a real-life case study. You’ll come away feeling more prepared and confident when this issue comes knocking at your compliance door.

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Learn more about Rebekah Leonard’s, Yikes! The APR or APY is WRONG…Now What? webinar.