12 CFR § 37.3 - Prohibited practices.
---
identifier: "/us/cfr/t12/s37.3"
source: "ecfr"
legal_status: "authoritative_unofficial"
title: "12 CFR § 37.3 - Prohibited practices."
title_number: 12
title_name: "Banks and Banking"
section_number: "37.3"
section_name: "Prohibited practices."
chapter_name: "COMPTROLLER OF THE CURRENCY, DEPARTMENT OF THE TREASURY"
part_number: "37"
part_name: "DEBT CANCELLATION CONTRACTS AND DEBT SUSPENSION AGREEMENTS"
positive_law: false
currency: "2026-04-05"
last_updated: "2026-04-05"
format_version: "1.1.0"
generator: "[email protected]"
authority: "12 U.S.C. 1 24(Seventh), 93a, 1818."
regulatory_source: "67 FR 58976, Sept. 19, 2002, unless otherwise noted."
cfr_part: "37"
---
# 37.3 Prohibited practices.
(a) *Anti-tying.* A national bank may not extend credit nor alter the terms or conditions of an extension of credit conditioned upon the customer entering into a debt cancellation contract or debt suspension agreement with the bank.
(b) *Misrepresentations generally.* A national bank may not engage in any practice or use any advertisement that could mislead or otherwise cause a reasonable person to reach an erroneous belief with respect to information that must be disclosed under this part.
(c) *Prohibited contract terms.* A national bank may not offer debt cancellation contracts or debt suspension agreements that contain terms:
(1) Giving the bank the right unilaterally to modify the contract unless:
(i) The modification is favorable to the customer and is made without additional charge to the customer; or
(ii) The customer is notified of any proposed change and is provided a reasonable opportunity to cancel the contract without penalty before the change goes into effect; or
(2) Requiring a lump sum, single payment for the contract payable at the outset of the contract, where the debt subject to the contract is a residential mortgage loan.