12 CFR 34.23
§ 34.23 Prepayment fees.
United States · 12 CFR — Banks and Banking · Status: effective
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- Citation
- 12 CFR 34.23, § 34.23 Prepayment fees, United States, version 1 as recorded 2026-07-09, yourstate.us, https://yourstate.us/provision/43407
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Full text
A national bank offering or purchasing ARM loans may impose fees for prepayments notwithstanding any State law limitations to the contrary. For purposes of this section, prepayments do not include:
(a) Payments that exceed the required payment amount to avoid or reduce negative amortization; or
(b) Principal payments, in excess of those necessary to retire the outstanding debt over the remaining loan term at the then-current interest rate, that are made in accordance with rules governing the determination of monthly payments contained in the loan documents.
Legislative history
This is a federal regulation, adopted through agency rulemaking under the Administrative Procedure Act — not enacted by a recorded vote of Congress.