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#2130367 - 05/12/17 08:30 PM Determining bona fide & reasonable fee for cards
Beth175 Offline
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Beth175
Joined: Feb 2009
Posts: 153
Wisconsin
Has anyone tried to determine if their credit card fees are bona fide and reasonable yet? We have started but not sure how to compare our fees to others when they list the fee such as : Foreign Transaction Fee 0 - 3%. Would you compare to a 0% minimum fee or the maximum 3% fee? The agreements don't explain how the customer can determine what % they will be charged. I am tempted to just throw all of the fees into the MAPR as we don't expect to have any (or very few) covered borrowers and waiving the fees for them might be less costly than determining if the fees are bona fide & reasonable on an annual basis.

Thanks much!

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#2134975 - 06/20/17 04:47 PM Re: Determining bona fide & reasonable fee for cards Beth175
Jan94 Offline
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Joined: Mar 2001
Posts: 828
USA
We're struggling with similar concerns. Our card area has gone through an established their bona fide and reasonable fees; we didn't have any with ranges so didn't have that concern. However, we are having an issue with a couple of fees where we can't find any comparisons with other FIs. They might say they charge a certain fee (such as a FedEx fee), but they don't disclose anywhere the amount of the fee. Our understanding of the requirement is that if we can't confirm they are bona fide and reasonable, then we can't exclude any fees. As with you, we're also considering whether we just include them all as we are not expecting we will have few covered borrowers. It's a bit frustrating when the regulation provides a safe harbor that may not be available.

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#2135955 - 06/27/17 12:48 PM Re: Determining bona fide & reasonable fee for cards Jan94
Beth175 Offline
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Beth175
Joined: Feb 2009
Posts: 153
Wisconsin
Would fees such as card replacement fee that aren't exactly a transaction fee still need to be included in the MAPR? If so, most of the large card issuers don't disclose such a fee in their agreements.

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#2138481 - 07/17/17 08:13 PM Re: Determining bona fide & reasonable fee for cards Beth175
CompliantOkie Offline
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CompliantOkie
Joined: Dec 2013
Posts: 422
OOOOOOklahoma
I'm having that exact same issue Beth. I have not found a large issuers that states their replacement card fee or an over the limit fee. This would be so much easier if the Bureau would just tell us what amount is bona fide.

How is everyone treating banks that issue multiple types of cards. For instance, we have 1 credit card. It has an annual fee. BOA has multiple credit cards. Some have annual fees and some do not. So can I compare my annual fee to only the BOA cards that have annual fees?

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#2138491 - 07/17/17 08:49 PM Re: Determining bona fide & reasonable fee for cards Beth175
John Burnett Offline
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John Burnett
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Cape Cod
"This would be so much easier if the Bureau would just tell us what amount is bona fide."

That is true, but this isn't the Bureau's regulation (even if it may have helped DoD a bit putting it together), and DoD hasn't a clue to what's bona fide,
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#2138507 - 07/17/17 11:17 PM Re: Determining bona fide & reasonable fee for cards Beth175
CULady Offline
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Joined: Sep 2007
Posts: 495
WA
I just went to the CFPB credit card site (https://www.consumerfinance.gov/credit-cards/agreements/) and grabbed 3 different card types from six different large card issuers (but only one from Discover because that's all they had) (https://www.nilsonreport.com/publication_chart_of_the_month.php?1=1&issue=1081). I pulled the credit card disclosures, saved them and then logged all of the fees disclosed in a spreadsheet. We don't have very many fees and ours are all lower than those I looked at, so I called it good. But I figure this way if anyone asks how I determined it was "bona fide" I have a spreadsheet and copies of other institutions disclosures to back it up.

I interpret the card reorder fee as a the same type of fee as a late fee and don't think it should be included in the MAPR nor does it need to be determined if it is "bona fide." Not sure if regulators will agree with me, but without any clarification... Also in the Interpretive Ruling it says the DOD believes information on credit card fees are "widely available." So if I can't find them by looking at 16 different card types, I feel just a bit more justified. laugh Obviously, this is how we are choosing to interpret MLA until told otherwise... And if a regulator can offer some guidance, we will take it!

But I am definitely all ears if someone can point out something that I am missing! smile

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#2138550 - 07/18/17 03:12 PM Re: Determining bona fide & reasonable fee for cards Beth175
CompliantOkie Offline
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CompliantOkie
Joined: Dec 2013
Posts: 422
OOOOOOklahoma
Lady-
How are you treating over-the-limit fees? We charge one and I think we could argue they should be included in the MAPR but I am having a hard time finding another bank that charges/discloses that particular fee.

John-
Of course you're right. I forget the DoD blessed us with this particular Reg which is so vague and difficult to understand. I am loathe to say..perhaps the bureau should have helped a bit more.

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#2138564 - 07/18/17 03:49 PM Re: Determining bona fide & reasonable fee for cards Beth175
CULady Offline
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Joined: Sep 2007
Posts: 495
WA
Okie- We don't have an over the limit fee, so I haven't had to go down that path. In my mind, I think I would probably put over the limit fees with the late fee. It is charged when the member doesn't abide by the loan contract. I don't have any regulatory back up, but that's my thoughts on it. Have you thought about trying to call a help line at FDIC to see how they will treat those fees in an exam...?

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#2138911 - 07/20/17 03:21 PM Re: Determining bona fide & reasonable fee for cards Beth175
CompliantOkie Offline
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CompliantOkie
Joined: Dec 2013
Posts: 422
OOOOOOklahoma
Ok I've come around to thinking the over limit fee is not included in MAPR.

When sampling cc agreements posted on the bureau's website, how is everyone treating fee ranges? For example, our annual fee is $20. BOA discloses their annual fee of $0-99 depending on card type. How can I compare our set fee to a range of fees?

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#2139265 - 07/24/17 05:52 PM Re: Determining bona fide & reasonable fee for cards CompliantOkie
river girl Offline
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Joined: Nov 2004
Posts: 1,005
Am I understanding correctly?

We have a fee. If it is a finance charge type of fee we include in MAPR UNLESS we know fee is bona fide. If bona fide, dont' include in MAPR.

Bona fide means we did the comparison to 5 other FI with portfolios over $3 billion, etc. We only do the comparision to make a finance charge type of fee bona fide.

We don't have to compare our debt protection product fees since they aren't allowed to be excluded from MAPR for any reason.

Transaction fees are finance charges so our ATM fees would need to be classified as bona fide as well as our annual fee.

If we do a comparison of fees and look at the 6/2016 call report to determine portfolio value, do we have to find the fee schedule from that date to do an aligned fee comparison?

I hope I'm understanding correctly.

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#2141214 - 08/08/17 04:17 PM Re: Determining bona fide & reasonable fee for cards river girl
Compliance Poster Offline
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Joined: Sep 2001
Posts: 413
I‘ve verified that all of our fees are bonafide (balance transfer, cash advance, returned payment, etc.) except one: pay-by-phone fee. I cannot find a comparable fee in any of the agreements. Do you agree that it must go in the MAPR?

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#2141635 - 08/10/17 10:37 PM Re: Determining bona fide & reasonable fee for cards CULady
lrvogl Offline
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lrvogl
Joined: Apr 2014
Posts: 8
Illinois
Lady,

This is exactly the process I took to document our fees are "bona fide and reasonable". Glad I saw your post to confirm my instincts.

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#2142710 - 08/18/17 06:25 PM Re: Determining bona fide & reasonable fee for cards lrvogl
river girl Offline
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Joined: Nov 2004
Posts: 1,005
am I reading this string to say we DO include replace lost card, ATM fees, international transaction conversion fee and express card delivery fee in the MAPR calculation?

We DO NOT include late fee, returned item fee, copy of statement fee, returned mail fee or OD transfer fee.

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