As used in this chapter:
(1) “Affiliate” means any company that controls, is controlled by, or is under common control with another company, as set forth in the Bank Holding Company Act of 1956, 12 U.S.C. § 1841 et seq., as it existed on March 1, 2003, as of July 16, 2003;
(2) “Annual percentage rate” means the annual percentage rate for the loan calculated according to the provisions of the Truth in Lending Act, 15 U.S.C. § 1601 et seq., as it existed on March 1, 2003, and the regulations promulgated thereunder by the Board of Governors of the Federal Reserve System;
(3) “Bona fide loan discount points” means loan discount points knowingly paid by the borrower for the purpose of reducing, and that, in fact, result in a bona fide reduction of the interest rate or time price differential applicable to the loan, provided that the amount of the interest rate reduction purchased by the discount points is reasonably consistent with established industry norms and practices for secondary mortgage market transactions;
(4) “Creditor” means any person or entity who participates in the original making or approving of a high-cost home loan;
(5)
(A) “High-cost home loan” means a loan, including an open-end credit plan, other than a bridge or construction loan, or a loan made for the purchase of a one-family to four-family residential structure that is secured by a first lien on the structure, in which:
(i) The total loan amount does not exceed one hundred fifty thousand dollars ($150,000);
(ii) The borrower is a natural person;
(iii) The debt is incurred by the borrower primarily for personal, family, or household purposes;
(iv) The loan is secured by a mortgage or deed of trust on real estate upon which there is located a structure or structures designed principally for the occupancy of from one (1) to four (4) families which is or will be occupied by the borrower as the borrower's principal dwelling; and
(v) The terms of the loan meet or exceed one (1) or more of the thresholds as defined in subdivision (8) of this section.
(B) “High-cost home loan” does not include any loan which within sixty (60) days after closing will be insured by, securitized for, or sold to a government agency or government-sponsored enterprise, including the United States Department of Housing and Urban Development, the United States Department of Veterans Affairs, Federal Home Loan Mortgage Corporation, Federal National Mortgage Association, Arkansas Development Finance Authority, and the United States Department of Agriculture, or that the lender can demonstrate was in good faith intended to be so insured by, securitized for, or sold to the government agency or government-sponsored enterprise;
(6)
(A) “Points and fees” means:
(i) All items required to be disclosed under 12 C.F.R. § 226.4(a) and (b), as they existed on March 1, 2003, except interest or the time-price differential unless those items are exempt from disclosure under 12 C.F.R. § 226.4(c), (d), (e), or (f), as they existed on March 1, 2003, except for the items listed under 12 C.F.R. § 226.4(c)(7), as it existed on March 1, 2003, the inclusion or exclusion of which is governed by subdivision (6)(A)(ii) of this section;
(ii) All charges for items listed under 12 C.F.R. § 226.4(c)(7), as it existed on March 1, 2003, but only if the lender receives direct or indirect compensation in connection with the charge or the charge is paid to an affiliate of the lender, but only by the amount the charge exceeds the charge for comparable items provided by a nonaffiliate of the lender at the time the loan is made. Otherwise, the charges are not included within the meaning of the phrase “points and fees”;
(iii) All compensation paid directly or indirectly by the borrower to a mortgage broker not otherwise included in subdivision (6)(A)(i) or subdivision (6)(A)(ii) of this section; and
(iv) The maximum prepayment fees and penalties that may be charged or collected under the terms of the loan documents, but only if the prepayment fees or penalties exceed:
(a) Three percent (3%) of the principal loan amount remaining on the date of the prepayment if the prepayment is made within the first twelve-month period immediately following the date the loan was made;
(b) Two percent (2%) of the principal loan amount remaining on the date of the prepayment, if the prepayment is made within the second twelve-month period immediately following the date the loan was made; or
(c) One percent (1%) of the principal loan amount remaining on the date of the prepayment, if the prepayment is made within the third twelve-month period following the date the loan was made.
(B) “Points and fees” shall not include:
(i) Taxes, filing fees, and recording and other charges and fees paid or to be paid to public officials for determining the existence of or for perfecting, releasing, or satisfying a security interest; and
(ii) Fees paid to a person other than a lender or an affiliate of the lender or to the mortgage broker or an affiliate of the mortgage broker for the following:
(a) Tax payment services;
(b) Flood certification;
(c) Pest infestation and flood determinations;
(d) Appraisal fees;
(e) Inspections performed before closing;
(f) Credit reports;
(g) Surveys;
(h) Attorney's fees, if the borrower has the right to select the attorney from an approved list or otherwise;
(i) Notary fees;
(j) Escrow charges, so long as not otherwise included under subdivision (6)(A)(i) of this section;
(k) Title insurance premiums; and
(l) Fire insurance and flood insurance premiums, if the conditions in 12 C.F.R. § 226.4(d)(2), as it existed on March 1, 2003, are met;
(7) “Reverse mortgage transaction” means a nonrecourse loan secured by a borrower's principal residence that:
(A) Provides cash advances to a borrower based upon the amount of equity in the borrower's residence; and
(B) Requires no payment of principal or interest until the entire loan becomes due and payable;
(8)
(A) “Thresholds” means, without regard to whether the loan transaction is or may be a “residential mortgage transaction”, as the term “residential mortgage transaction” is defined in 12 C.F.R. § 226.2(a)(24), as it existed on March 1, 2003:
(i) The annual percentage rate of the loan at the time the loan is consummated is such that the loan is a “mortgage” under the Home Ownership and Equity Protection Act of 1994, 15 U.S.C. § 1602(aa), and regulations adopted pursuant thereto by the Board of Governors of the Federal Reserve System, including 12 C.F.R. § 226.32, as it existed on March 1, 2003; or
(ii) The total points and fees payable by the borrower at or before the closing exceed:
(a) Five percent (5%) of the total loan amount if the loan amount is seventy-five thousand dollars ($75,000) or more;
(b) Six percent (6%) of the total loan amount if the total loan amount is more than twenty thousand dollars ($20,000), but less than seventy-five thousand dollars ($75,000); or
(c) Eight percent (8%) of the total loan amount if the total loan amount is twenty thousand dollars ($20,000) or less.
(B) The following discount points and prepayment fees and penalties shall be excluded from the calculation of the total points and fees payable by the borrower:
(i) Up to and including two (2) bona fide loan discount points payable by the borrower in connection with the loan transaction, but only if the interest rate from which the loan's interest rate will be discounted does not exceed by more than one (1) percentage point the required net yield for a ninety-day standard mandatory delivery commitment for a reasonably comparable loan from either the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation, whichever is greater; and
(ii) Up to and including one (1) bona fide loan discount point payable by the borrower in connection with the loan transaction, but only if the interest rate from which the loan's interest rate will be discounted does not exceed by more than two (2) percentage points the required net yield for a ninety-day standard mandatory delivery commitment for a reasonably comparable loan from either the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation, whichever is greater; and
(9) “Total loan amount” means the same as the term “total loan amount” as used in 12 C.F.R. § 226.32, as it existed on March 1, 2003, and the total loan amount shall be calculated in accordance with the Board of Governors of the Federal Reserve System's Official Staff Commentary thereto.