On November 18, 2020, the CFPB, together with the Comptroller of the Currency, and Federal Reserve Board, announced that there will be no change to the annual threshold amount for exempting loans from special appraisal requirements for higher-priced mortgage loans (“HPMLs”).
HPMLs are subject to additional appraisal requirements under Section 35 of Regulation Z, including requirements to obtain two independent appraisals in some circumstances. 12 C.F.R. 1026.35(c). However, these rules do not apply to loans in the amount of $25,000 or less, with the $25,000 amount to be adjusted annually based on any annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (“CPI-W”).
If there is not increase from the CPI-W in effect on June 1 of the previous year, the exemption threshold will not be adjusted. Based on the CPI-W in effect as of June 1, 2020, the exemption threshold will remain at $27,200, as it was in 2020.
