[Code of Federal Regulations]

[Title 12, Volume 3]

[Revised as of January 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 12CFR226.21]



[Page 303]

 

                       TITLE 12--BANKS AND BANKING

 

                   CHAPTER II--FEDERAL RESERVE SYSTEM

 

PART 226_TRUTH IN LENDING (REGULATION Z)--Table of Contents

 

                       Subpart C_Closed-End Credit

 

Sec. 226.21  Treatment of credit balances.



    When a credit balance in excess of $1 is created in connection with 

a transaction (through transmittal of funds to a creditor in excess of 

the total balance due on an account, through rebates of unearned finance 

charges or insurance premiums, or through amounts otherwise owed to or 

held for the benefit of a consumer), the creditor shall:

    (a) Credit the amount of the credit balance to the consumer's 

account;

    (b) Refund any part of the remaining credit balance, upon the 

written request of the consumer; and

    (c) Make a good faith effort to refund to the consumer by cash, 

check, or money order, or credit to a deposit account of the consumer, 

any part of the credit balance remaining in the account for more than 6 

months, except that no further action is required if the consumer's 

current location is not known to the creditor and cannot be traced 

through the consumer's last known address or telephone number.