---
kind: "section"
citation: "32 C.F.R. § 232.2"
title: "32"
number: "232.2"
heading: "Applicability; examples."
url: "https://uscodex.org/cfr/32/232.2"
---

# §232.2. Applicability; examples.

- (a)
  - (1) **Applicability.** This part applies to consumer credit extended by a creditor to a covered borrower, as those terms are defined in this part. Nothing in this part applies to a credit transaction or account relating to a consumer who is not a covered borrower at the time he or she becomes obligated on a credit transaction or establishes an account for credit. Nothing in this part applies to a credit transaction or account relating to a consumer (which otherwise would be consumer credit) when the consumer no longer is a covered borrower.
  - (2) **Examples—**
    - (i) **Covered borrower.** Consumer A is a member of the armed forces but not serving on active duty, and holds an account for closed-end credit with a financial institution. After establishing the closed-end credit account, Consumer A is ordered to serve on active duty, thereby becoming a covered borrower, and soon thereafter separately establishes an open-end line of credit for personal purposes (which is not subject to any exception or temporary exemption) with the financial institution. This part applies to the open-end line of credit, but not to the closed-end credit account.
    - (ii) **Not a covered borrower.** Same facts as described in [paragraph (a)(2)(i)](#a-2-i) of this section. One year after establishing the open-end line of credit, Consumer A ceases to serve on active duty. This part never did apply to the closed-end credit account, and because Consumer A no longer is a covered borrower, this part no longer applies to the open-end line of credit.
- (b) **Examples.** The examples in this part are not exclusive. To the extent that an example in this part implicates a term or provision of Regulation Z ([12 CFR part 1026](/cfr/12/part1026.md)), issued by the Consumer Financial Protection Bureau to implement the Truth in Lending Act, Regulation Z shall control the meaning of that term or provision.

## Notes

### Authority

Authority: 10 U.S.C. 987.

### Source

Source: 80 FR 43606, July 22, 2015, unless otherwise noted.