Hello - When there is a change in the sweep fee amount charged per day to the OD LOC (subject to Rez Z), would the change in terms notice have a 30 day advance notice requirement or a 45 day requirement. There is some confusion surrounding the timing and was wondering if anyone has any feedback on that.

Thank you.

1026.9(c)(2)(i) Changes where written advance notice is required. (A) General. For plans other than home-equity plans subject to the requirements of §1026.40, except as provided in paragraphs (c)(2)(i)(B), (c)(2)(iii) and (c)(2)(v) of this section, when a significant change in account terms as described in paragraph (c)(2)(ii) of this section is made, a creditor must provide a written notice of the change at least 45 days prior to the effective date of the change to each consumer who may be affected.

Thank you - It's 45 days for a significant change in account terms -when reviewing (c)(2)(ii) and § 1026.6(b)(1), (b)(2), § 1026.6(b)(4) a change in the "sweep fee" doesn't seem to fit the definition of significant change in terms. Am I missing something?

(ii) Significant changes in account terms. For purposes of this section, a “significant change in account terms” means a change to a term required to be disclosed under §1026.6(b)(1) and (b)(2),

Transaction charges have to be disclosed under 6(b)(2)(iv)

I read 6(b)(2)(iv) Transaction charges. Any transaction charge imposed by the creditor for use of the open-end plan for purchases.

This is a fee that will be charged to the OD LOC if there is a need to transfer funds to the checking account to cover an overdraft. I was thinking it was a fee for the service and not for purchases, therefore the 45 days would not apply, but now I'm questioning whether that makes a difference.

Well, you might have a point - so you think it falls under the disclosure requirements .6(b)(3)?

Because the fee will be charged to the OD LOC - would it be considered a finance charge? If so, I think that would fall under 1026.6(b)(3) and in that case we could either:

[i]A) Comply with the requirements of paragraph (c)(2)(i) of this section; or (send a 45 day notice of the change)

[i](B) Provide notice of the amount of the charge before the consumer agrees to or becomes obligated to pay the charge, at a time and in a manner that a consumer would be likely to notice the disclosure of the charge. The notice may be provided orally or in writing. (send a 30 day notice of the change)

Any thoughts would be greatly appreciated!

Thank you.

It is definitely a finance charge - so I do agree with your analysis.

Thank you for your help!