By Elva Coffey-Sears
While it’s hard to predict what changes 2017 may bring to the compliance arena, the first of the regulatory changes to be integrated into your compliance program are the annual adjustments to the various regulatory thresholds. These thresholds are adjusted annually based on various consumer price indexes at defined times during the year.
The asset-size exemption threshold for HMDA reporting remains unchanged at $44 million, but the HMDA revisions provide additional institutional coverage tests, so be sure to review those as well.
The Community Reinvestment Act (CRA) asset-size thresholds to define small, intermediate small, and large institutions are increased in 2017. A small institution is defined as having less than $1.226 billion in assets as of December 31 of either of the prior two calendar years; an intermediate small institution has assets of at least $307 million as of December 31 of both of the prior two calendar years and less than $1.226 billion as of either of the prior two calendar years; and a large institution has at least $1.226 billion is assets as of December 31 of both of the prior two years.
The asset threshold for determining Small Creditor Status is increased to $2.069 billion (up from $2.052 billion in 2016). This threshold determines whether the Ability to Repay/Qualified Mortgage and HPML escrow requirements apply to an institution.
Adjustments for thresholds relating to open end credit under the CARD Act: The threshold triggering requirements to disclose minimum interest charges remain unchanged at $1.00; the safe harbors for penalty fee violations remain unchanged at $27 for a first violations and $38 for a subsequent violation.
For HOEPA loans, the adjusted total loan amount threshold for high-cost mortgages is increased from $20,350 to $20,579 and the adjusted points and fees dollar triggers for high-cost mortgages is increased from $1,017 to $1,029.
For 2017 a covered transaction is not a qualified mortgage unless the transaction’s total points and fees do not exceed:
- For a loan amount greater than or equal to $102,894: 3 percent of the total loan amount;
- For a loan amount greater than or equal to $61,737 but less than $102,894: $3,087;
- For a loan amount greater than or equal to $20,579 but less than $61,737: 5 percent of the total loan amount;
- For a loan amount greater than or equal to $12,862 but less than $20,579; $1,029;
- For a loan amount less than $12,862: 8 percent of the total loan amount.
The exemption threshold triggering special appraisal requirements for HPMLs remains unchanged at $25,500.
The dollar thresholds for exempt consumer credit transactions under Regulation Z and exempt consumer lease transactions under Regulation M remain unchanged at $54,600.
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