HPML ESCROW EXEMPTION THRESHOLD INCREASED

For 2020 the CFPB amended the official commentary that interprets the requirements of Regulation Z (Truth in Lending) to reflect a change in the asset size threshold for certain creditors to qualify for an exemption to the requirement to establish an escrow account for a higher-priced mortgage loan.  The exemption threshold is adjusted to $2.202 billion from $2.167 billion.  The revised commentary to regulation Z, Paragraph 1026.35(b)(2)(iii)-1(iii)(E), includes the amended threshold stating:

Under section 1026.35(b)(2)(iii)(C), the $2,000,000,000 asset threshold adjusts automatically each year based on the year-to-year change in the average of the Consumer Price Index for urban Wage Earners and Clerical Workers, not seasonally adjusted, for each 12-month period ending in November, with rounding to the nearest million dollars.  The Bureau will publish notice of the asset threshold each year by amending this comment.  For calendar year 2020, the asset threshold is $2,202,000,000.  A creditor that together with the assets of its affiliates that regularly extended first-lien covered transactions during calendar year 2019 has total assets of less than $2,202,000,000 on December 31, 2019, satisfies this criterion for purposes of any loan consummated in 2020 and for purposes of any loan consummated in 2021 for which the application was received before April 1, 2021.

The final rule posted in the Federal Register is available here.

Information on adjustments already released for 2020 include:

Regulation Z Threshold Adjustments for 2020 

Additional Thresholds for Regulation Z and M

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