Appraisals for Higher-Priced Mortgage Loans Exemption Threshold Adjustments
The OCC, the Board, and the Bureau are finalizing amendments to the official interpretations for their regulations that implement section 129H of the Truth in Lending Act (TILA). Section 129H of TILA establishes special appraisal requirements for “higher-risk mortgages,” termed “higher-priced mortgage loans” or “HPMLs” in the agencies' regulations. The OCC, the Board, the Bureau, the Federal Deposit Insurance Corporation (FDIC), the National Credit Union Administration (NCUA), and the Federal Housing Finance Agency (FHFA) (collectively, the Agencies) issued joint final rules implementing these requirements, effective Jan. 18, 2014. The Agencies' rules exempted, among other loan types, transactions of $25,000 or less, and required that this loan amount 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 no annual percentage increase in the CPI-W, the OCC, the Board, and the Bureau will not adjust this exemption threshold from the prior year. Additionally, in years following a year in which the exemption threshold was not adjusted because CPI-W decreased, the threshold is calculated by applying the annual percentage increase in the CPI-W to the dollar amount that would have resulted, after rounding, if the decreases and any subsequent increases in the CPI-W had been taken into account. Based on the CPI-W in effect as of June 1, 2023, the exemption threshold will increase from $31,000 to $32,400 effective Jan. 1, 2024.
Annual threshold adjustments
- Based on the CPI-W in effect as of June 1, 2023, the exemption threshold will increase from $31,000 to $32,400, effective Jan. 1, 2024.
- Based on the CPI-W in effect as of June 1, 2022, the exemption threshold will increase from $28,500 to $31,000, effective Jan. 1, 2023.
- Based on the CPI-W in effect as of June 1, 2021, the exemption threshold will increase from $27,200 to $28,500, effective Jan. 1, 2022.
- Based on the CPI-W in effect as of June 1, 2020, the exemption threshold will remain at $27,200, effective Jan. 1, 2021.
- Based on the CPI-W in effect as of June 1, 2019, the exemption threshold will increase from $26,700 to $27,200, effective Jan. 1, 2020.
- Based on the CPI-W in effect as of June 1, 2018, the exemption threshold will increase from $26,000 to $26,700 effective Jan. 1, 2019.
- Based on the CPI-W in effect as of June 1, 2017, the exemption threshold will increase from $25,500 to $26,000 effective Jan. 1, 2018.
- Based on the CPI-W in effect as of June 1, 2016, the exemption threshold will remain at $25,500 through Dec. 31, 2017.
- Proposed rule to amend the official interpretations for regulations that implement section 129H of TILA.
- Issued proposed rule
- Based on the annual percentage decrease in the CPI-W as of June 1, 2015, the exemption threshold will remain at $25,500 through Dec. 31, 2016.
- Based on the annual percentage increase in the CPI-W as of June 1, 2014, the OCC, the Board and the Bureau are adjusting the exemption threshold to $25,500, effective Jan. 1, 2015.