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F ed er a l Reser ve Ba n k
DALLAS. T E X A S

of

Dallas

75222
Circular No. 82-11
January 27, 1982

REGULATIONS M AND Z
CONSUMER LEASING/TRUTH IN LENDING
D eferral o f D a te for Mandatory C om pliance

TO ALL MEMBER BANKS
AND OTHERS CONCERNED IN THE
ELEVENTH FEDERAL RESERVE DISTRICT:
The Board o f Governors o f the Federal R e se r v e System is deferring
until O ctober 1, 1982, th e m andatory e f f e c t i v e d a te for com p lian ce with
Regulation M (Consumer Leasing) and revised R egulation Z (Truth in Lending),
which im plem ent the Truth in Lending Sim p lification and R eform A ct.
Enclosed are co p ies o f the Board's press r e le a se dated January 6,
1982, and th e m aterial as subm itted for publication in the Federal R egister
which more fully explain the Board's action.
Q uestions regarding th e R egulations should be directed to this
Bank's Legal D epartm ent, Ext. 6171.
Additional c o p ies o f this circular will be furnished upon request to
the D epartm ent o f C om m unications, Financial and C om m unity Affairs, Ext.
6289.
Sincerely yours,

William H. W allace
First Vice President
Enclosure

Banks and others are encouraged to use the following incoming W ATS numbers in contacting this Bank:
1-800-442-7140 (intrastate) and 1-800-527-9200 (interstate). For calls placed locally, please use 651 plus the
extension referred to above.

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

FEDERAL RESERVE press release

For immediate release

January 6, 1982

The mandatory effective date of the Federal Reserve Board's
Regulation M (Consumer Leasing) and Regulation Z (Truth in Lending), as
these regulations were revised to implement the Truth in Lending
Simplification and Reform Act, has been postponed until October 1, 1982.
This will conform the Board's regulations with an amendment
to the Simplification Act, signed into law December 26, 1981, delaying
the mandatory effective date of the Simplification Act from April 1, 1982
to October 1, 1982.
Notice of the action, by the Board's secretary acting under
delegated authority, is attached.

Attachment

FEDERAL RESERVE SYSTEM

[12 CFR Par ts 213 and 226]
[Reps. M and Z; Docket No. R-0381]
CONSUM LEASING/TRUTH IN LENDING
ER
Deferral of Date for Mandatory Compliance
AGENCY:

Board of Governors of the Federal Reserve System.

ACTION:

Deferral of mandatory e f f e c t i v e d a te s .

SU M RY The Board i s d e f e r r i n g u n t i l October 1, 1982, th e mandatory e f f e c t i v e
MA :
date for compliance with Regulation M (Consumer Leasing) and revised Regulation Z
(Truth in Lending), which implement the Truth in Lending S i m plifi cation and
Reform Act. Although the revised r eg u lati o n s became e f f e c t i v e on April 1, 1981,
compliance o r i g i n a l l y was not required u n t i l April 1, 1982. In the i n ter im ,
c r e d i t o r s were given a t r a n s i t i o n period during which they could comply with
e i t h e r th e revised r e g u la ti o n s or the previous Regulation Z. On December
26, 1981, th e Pre siden t signed in to law an amendment to th e Truth in Lending
S im p lific a tio n and Reform Act delaying the mandatory e f f e c t i v e date f o r six
months u n t il October 1, 1982. Pursuant to t h i s new s t a t u t o r y mandate, the
Board i s d e f e rr in g th e mandatory e f f e c t i v e date for compliance with i t s revised
r e g u l a tio n s and continuing the t r a n s i t i o n period u n til October 1, 1982.
The Board i s a l s o d e f e rr in g u n t i l October 1, 1982, r e s c i s s i o n of
c e r t a i n provisions in the previous Regulation Z (implementing th e Truth in
Lending Act p r i o r t o th e 1980 s i m p l i f i c a t i o n amendments). The Board had
permitted c r e d i t o r s to comply, e f f e c t i v e January 10, 1980, with amendments to
the previous re gulation t h a t provided g r e a t e r f l e x i b i l i t y and p r o te c tio n in
d i s c l o s i n g th e annual percentage r a t e and other terms. Cr ed itors could, however,
continue t o comply with provisions of previous Regulation Z u n t i l April 1,
1982. Cr ed it o rs may now continue t o comply with th e previous re gulat ion un til
October 1, 1982.
EFFECTIVE DATE:

December 31, 1981.

FOR FURTHER INFORM
ATION CONTACT: Barbara D. Ranagan, S t a f f Attorney (202-452­
3667), Division of Consumer and Community A f f a i r s , Board of Governors of the
Federal Reserve System, Washington, D.C. 20551.
SUPPLEM
ENTARY INFORMATION: (1) I n t r o d u c t i o n . Eff ec tive April 1, 1981, th e
Board sim p l if ie d i t s consumer c r e d i t r u les in Regulation Z (12 CFR Part 226)
and issued a revised r e g u la ti o n . The Board also e x tr a c te d the consumer lea sing
r u le s from Regulation Z and placed them in Regulation M (12 CFR Part 213) (46
FR 20848, April 7, 1981). The r e s u l t i n g new r e g u la tio n s ( h e r e i n a f t e r r e f e r r e d
to as the " sim p lif ied r e g u l a tio n s " ) r e f l e c t amendments made by the Truth in

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Lending S i m p li fi c a t io n and Reform Act ( T i t l e VI of th e Depository I n s t i t u t i o n s
Deregulation and Monetary Control Act of 1980, Pub. L. 96-221, 94 S t a t . 170,
March 31, 1980). That act had a mandatory e f f e c t i v e date of April 1, 1982,
but permitted c r e d i t o r s to comply with the sim p lif ie d r eg u latio n s t h a t the
Board was required to promulgate by April 1, 1981. The previous Regulation Z
( h e r e i n a f t e r r e fe r r e d to as " p r e - s i m p l i f i c a t i o n Regulation Z") and accompanying
appendices, supplements and i n t e r p r e t a t i o n s were to remain concu rre ntly e f f e c t i v e
during th e interim . By promulgating i t s sim p l if ie d r eg u latio n s in April of 1981,
the Board provided a 1-year t r a n s i t i o n period during which c r e d i t o r s could
choose t o comply with e i t h e r th e sim p lif ie d r e g u la t io n s or the p r e - s i m p l i f i c a t i o n
Regulation Z u n til compliance became mandatory on April 1, 1982. The purpose
of the t r a n s i t i o n period was to allow c r e d i t o r s s u f f i c i e n t time t o modify
t h e i r d i s c lo s u r e forms and adapt t h e i r procedures. The O ffi cial S t a f f Commentary
t o sim p lif ie d Regulation Z was issued on October 6, 1981 (46 FR 50288, October
9, 1981) giving c r e d i t o r s who had waited for f u r t h e r c l a r i f i c a t i o n s l i g h t l y
l e s s than six months to meet the April 1, 1982, mandatory compliance dat e.
O December 26, 1981, th e President signed in to law an amendment t o
n
th e Truth in Lending S im p l ifi c a t io n and Reform Act delaying th e mandatory
e f f e c t i v e date f o r six months t o October 1, 1982 ( T i t l e I I I of the Inte rn a t io n a l
Banking F a c i l i t y Deposit Insurance Act, Pub. L. 97-110, 95 S t a t . 1513). The
d e f e r r a l provides c r e d i t o r s and l e s s o r s additional time to achieve compliance
and r eq uire s the Board to delay the mandatory compliance date of i t s s i m pli fied
r e g u l a t i o n s . Accordingly, the Board is continuing the t r a n s i t i o n period so
t h a t c r e d i t o r s who wish t o do so may continue to comply with p r e - s i m p l i f i c a t i o n
Regulation Z and accompanying appendices, supplements, and i n t e r p r e t a t i o n s
u n t i l October 1, 1982. The Board i s also making tech n ical amendments to two
footnotes in si m p lif ie d Regulation Z t h a t r e f e r t o th e mandatory compliance
date by changing the date to October 1, 1982.
The change being made i s limited s t r i c t l y t o th e d e f e r r a l of th e
mandatory compliance date and does not a l t e r the April 1, 1981, optional
compliance d ate. It simply prolongs the t r a n s i t i o n period and does not in any
way a f f e c t the s ubs tantive requirements in p r e - s i m p l i f i e d Regulation Z, the
s i m p l if i e d r e g u l a t i o n s , or the t r a n s i t i o n r ules discussed in 46 FR 20848.
Technical amendments t h a t conform th e re fere nc es in the O ffic ia l S t a f f
Commentary on Regulation Z to the deferred mandatory compliance date will be
made when the commentary is r ev is ed .
Five s t a t e s had been granted exemptions from p r e - s i m p l i f i c a t i o n
Regulation Z. Those exemptions - - to Connecticut, Maine, Massachusetts,
Oklahoma, and Wyoming — were due t o expire on April 1, 1982. They will now
remain in e f f e c t u n t i l October 1, 1982, unless superseded by a new exemption
granted under th e s im plifie d r e g u l a t i o n s . Any s t a t e , including the exempt
s t a t e s , may s t i l l seek an exemption from the sim p l if ie d r eg u latio n s before t h a t
date.
The Board i s als o d e f e rr in g u n t i l October 1, 1982, r e s c i s s i o n of
c e r t a i n provisions concerning the annual percentage r a t e in p r e - s i m p l i f i c a t i o n
Regulation Z. O December 31, 1979, the Board amended provisions in p r e - s i m p l i ­
n
f i c a t i o n Regulation Z r e l a t i n g to the c a l c u l a t i o n and d is c lo s u r e of annual
percentage r a t e and other c r e d i t terms (44 FR 77139). Although these amendments

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had an e f f e c t i v e date of January 10, 1980, c r e d i t o r s were given the option
of complying with the new or the old provisions un til October 1, 1980. The
Board subsequently changed t h a t date from October 1, 1980, to April 1, 1982,
to coincide with the mandatory e f f e c t i v e date of the Truth in Lending S i m p l i f i ­
ca tion and Reform Act (45 FR 56795, August 26, 1980). The Board is now extending
th e optional compliance period u n t il October 1, 1982 t o coincide with the
defer red e f f e c t i v e date of the Truth in Lending S im p li ficatio n and Reform Act.
The a c tio n s being taken ar e required by Pub. L. 97-110 enacted
December 26, 1981. These a ctions f a c i l i t a t e implementation of th e 1980 s i m p l i ­
f i c a t i o n act and do not impose any a dditional burden or l i a b i l i t y . Therefore,
p u b licatio n of th e changes for public comment and a delay in t h e i r e f f e c t i v e
date are n e i t h e r necessary nor required under 5 U.S.C. 553(b) and ( d ), and
immediate implementation i s in th e public i n t e r e s t .
(2) Text of amendments.
suant to th e a u t h o r i t y granted in §
1604) as amended by Pub. L. 96-221,
97-110, 95 S t a t . 1513 (December 26,
as follows:

In co nsidera tion of the foregoing and pur­
105 of the Truth in Lending Act (15 U.S.C.
94 S t a t . 170 (March 31, 1980) and Pub. L.
1981), the Board amends i t s r eg u latio n s

1. The Board delays from April 1, 1982, t o October 1, 1982, the man­
datory e f f e c t i v e date f o r compliance with s im p lif ie d Regulations Z and M and
th e e x p ir a tio n of p r e - s i m p l i f i c a t i o n Regulation Z (12 CFR Part 226), appendices,
supplements, Board and s t a f f i n t e r p r e t a t i o n s , and s t a t e exemptions. The April 1,
1981, e f f e c t i v e date f o r optional compliance with sim p l if ie d Regulations Z and M
as described in 46 FR 20848 (April 7, 1981) remains unchanged.
2. The Board amends sim p li f i e d Regulation Z (12 CFR Part 226) as
described in 46 FR 20848 (April 7, 1981) by changing the date in footnote 31a
t o § 226.14 and footnote 45a to § 226.22 from "April 1, 1982," t o "October 1,
1982."
3. The Board delays from April 1, 1982, t o October 1, 1982,
r e s c i s s i o n of § 226.5(b) through ( e ) , Board I n t e r p r e t a t i o n s §§ 226.502, 226.503
and 226.505, and Supplement I to p r e - s i m p l i f i c a t i o n Regulation Z (12 CFR
Part 226), as described a t 44 FR 77139 (December 31, 1979) and 45 FR 56795
(August 26, 1980). The January 10, 1980, e f f e c t i v e date for r e v isio n s t o §
226.5 and Supplement I , and new § 226.8(r ) and (s) remains unchanged.
(3) A u th o r ity . Sec. 105 of th e Truth in Lending Act as amended by
se c t io n 605, Pub. L. 96-221, 94 S t a t . 170 (15 U.S.C. 1604). Board of Governors
of th e Federal Reserve System, ac ting by the Secr etary of the Board pursuant
to delegated a u t h o r i t y under 12 CFR § 26 5.2 (a ),
December 31, 1981.

(signed) William W Wiles
.
William W Wiles
.
Sec retary of the Board
[SEAL]