Definitions and rules of construction

The term “high-cost mortgage”, and a mortgage referred to in this subsection, means a consumer credit transaction that is secured by the consumer’s principal dwelling, other than a reverse mortgage transaction, if— in the case of a credit transaction secured— the total points and fees payable in connection with the transaction, other than bona fide third party charges not retained by the mortgage originator, creditor, or an affiliate of the creditor or mortgage originator, exceed— For purposes of subparagraph (A)(i), the annual percentage rate of interest shall be determined based on the following interest rate: For the purposes of computing the total points and fees under paragraph (4), the total points and fees shall exclude— After the 2-year period beginning on the effective date of the regulations promulgated under section 155 of the Riegle Community Development and Regulatory Improvement Act of 1994, and no more frequently than biennially after the first increase or decrease under this subparagraph, the Bureau may by regulation increase or decrease the number of percentage points specified in paragraph (1)(A), if the Bureau determines that the increase or decrease is— An increase or decrease under subparagraph (A)— For purposes of paragraph (1)(B), points and fees shall include— each of the charges listed in section 1605(e) of this title (except an escrow for future payment of taxes), unless— The term “reverse mortgage transaction” means a nonrecourse transaction in which a mortgage, deed of trust, or equivalent consensual security interest is created against the consumer’s principal dwelling— with respect to which the payment of any principal, interest, and shared appreciation or equity is due and payable (other than in the case of default) only after— The term “mortgage originator”— means any person who, for direct or indirect compensation or gain, or in the expectation of direct or indirect compensation or gain— does not include any person who is— a retailer of manufactured or modular homes or an employee of the retailer if the retailer or employee, as applicable— discloses to the consumer— does not include, with respect to a residential mortgage loan, a person, estate, or trust that provides mortgage financing for the sale of 3 properties in any 12-month period to purchasers of such properties, each of which is owned by such person, estate, or trust and serves as security for the loan, provided that such loan— For the purposes of determining the amount of points and fees for purposes of subsection (aa), either the amounts described in paragraph (1) or (2) of the following paragraphs, but not both, shall be excluded: Up to and including 2 bona fide discount points payable by the consumer in connection with the mortgage, but only if the interest rate from which the mortgage’s interest rate will be discounted does not exceed by more than 1 percentage point— Unless 2 bona fide discount points have been excluded under paragraph (1), up to and including 1 bona fide discount point payable by the consumer in connection with the mortgage, but only if the interest rate from which the mortgage’s interest rate will be discounted does not exceed by more than 2 percentage points—