Massachusetts Amends Predatory Regulations By Patricia Antonelli, Esq. Amy Vitale.


The Massachusetts Division of Banks has amended the regulations regarding Unfair and Deceptive Practices in Consumer Transactions. The regulations are found at 209 CMR 40.00 and became effective on Nov. 4, 2005. The amendments were required to implement the provisions of the 2004 Predatory Home Loan Practices Act which became effective on Nov. 7, 2004.

The amendments to the regulations expand their purpose to include prevention of “predatory home loan practices” under Massachusetts General Laws Chapter 183C. Certain definitions in the regulations were revised and new definitions were added, including definitions for “bona fide loan discount points,” “broker,” “conventional prepayment penalty,” “lender,” “high cost home loan” and “points and fees.” Consistent with Chapter 183C, the regulations define “high cost home loan” as a consumer credit transaction secured by the borrower’s principal dwelling, which meets either the “APR threshold” or the “points and fees threshold” as described in the regulations.

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