Under the Truth in Lending Act (TILA) and its implementing Regulation Z, the concept of 'points and fees' is used to determine whether a mortgage qualifies as a high-cost loan. For most transactions, a loan may be classified as a high-cost mortgage if the total points and fees exceed:

Correct answer: 5% of the total loan amount

Under the Home Ownership and Equity Protection Act (HOEPA), as amended by Dodd-Frank and implemented through Regulation Z, a mortgage may be classified as a high-cost loan if total points and fees exceed 5% of the total loan amount (for loans of $20,000 or more). This threshold triggers additional consumer protections and disclosures. The 3% figure relates to the Qualified Mortgage (QM) points-and-fees cap, not HOEPA. The 2% and 8% figures are not standard HOEPA or QM thresholds.