Agencies Increase HPML Appraisal Exemption Threshold for 2020

The CFPB, Federal Reserve Board, and OCC announced an increase to the smaller loan exemption threshold for the special appraisal requirements for higher-priced mortgage loans (HPMLs) under TILA.  Effective, January 1, 2020, the exemption threshold amount for HPMLs will increase from $26,700 to $27,200.

The smaller loan exemption provides an exemption from the special appraisal requirements TILA imposes on HPMLs, including a requirement that creditors must obtain a written appraisal based on a physical visit to the property interior before extending an HPML to a consumer.  

In accordance with the requirement for the exemption threshold to be adjusted each year based on any annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers, this latest adjustment reflects the annual percentage increase in the consumer price index in effect as of June 1, 2019.