It’s hard to believe that it’s already December. As we scramble to lose the 5 pounds gained over Thanksgiving, check off our lists of who’s naughty or nice, it’s also a time to be reminded of the nuances of certain rules and a sanity check on others.
Annual Threshold Increases
Across the many regulations, there are several disclosures or processes that are triggered due to certain annual thresholds. If you haven’t created a centralized list for these, you may want to consider pulling one together now.
The OCC, Federal Reserve Board and the CFPB have jointly announced that the annual threshold exemption amount for to the appraisal requirements for higher-priced mortgage loans (HPMLs) will remain unchanged for 2016, staying at $25,500.
Consumer Credit and Lease Transactions
For exempt consumer credit and lease transactions, the Regulation Z and M thresholds for 2016 will also remain unchanged, staying at $54,600 or less.*
*Loans secured by real property or by personal property used or expected to be used as the principal dwelling of a consumer and private education loans are covered by Regulation Z (TILA) regardless of the loan amount.
The Bureau is amending the regulatory text and official interpretations for Regulation Z, which implements TILA, to update the dollar amounts of various thresholds that are adjusted annually based on the annual percentage change in the Consumer Price Index. The adjusted dollar amount for the penalty fees safe harbor in 2016 is $27 for a first late payment and $37 for each subsequent violation within the following six months. For HOEPA loans, the adjusted total loan amount threshold is $20,350, effective January 1, 2016. The adjusted statutory fee trigger for HOEPA loans is $1,017, effective January 1, 2016. Effective January 1, 2016, for the purpose of a creditor's determination of a consumer's ability to repay a transaction secured by a dwelling, a covered transaction is not a qualified mortgage unless the transaction's total points and fees do not exceed 3 percent of the total loan amount for a loan greater than or equal to $101,749; $3,052 for a loan amount greater than or equal to $61,050 but less than $101,749; 5 percent of the total loan amount for a loan greater than or equal to $20,350 but less than $61,050; $1,017 for a loan amount greater than or equal to $12,719 but less than $20,350; and 8 percent of the total loan amount for a loan amount less than $12,719.
Upcoming Effective Dates - January 1, 2016
- Mandatory escrow of flood insurance premiums and fees for certain loans unless otherwise exempted
- Title XIV Regulatory Reform updates to regulatory definitions of small creditor, and rural and underserved areas, for purposes of certain special provisions and exemptions from various requirements provided to certain small creditors
Take a quick sampling of your TRID, Privacy and HMDA data to ensure you are up-to-date and without error. Any regulatory reprieve on TRID is sure to be coming to an end soon; so don’t assume it will last forever, even if you are making good faith reasonable efforts.
Before we know it, it will be 2016 – and there will be a bunch of new rules to contend with!