On November 5, 2022, the Pennsylvania Department of Banking and Securities published the annual adjustment to the definition of “base figure” in the Pennsylvania Loan Interest and Protection Law. Effective January 1, 2023, the inflation-adjusted base figure for the 2023 calendar year will increase from $278,204 to $301,022.
The Pennsylvania Loan Interest and Protection Law requires that the base figure definition, found in 41 Pa. Stat. § 101, be adjusted annually for inflation. The adjusted amount is determined using the Consumer Price Index published by the United States Department of Labor, Bureau of Labor Statistics.
The base figure is used to determine when specific limitations apply for balloon payments, document preparation fees, impound accounts, and interest rates. Additionally, transactions with a loan amount less than the base figure may not have a prepayment penalty. DocMagic maintains an audit that will trigger on any transaction in which this occurs.
DocMagic will update its compliance matrices and audit to reflect the base figure adjustment effective January 1, 2023. If you have any questions regarding this article, please contact DocMagic’s Compliance Department.
