On August 4, 2016, the Consumer Financial Protection Bureau (“CFPB”), the Office of the Comptroller of the Currency (“OCC”), and the Board of Governors of the Federal Reserve System (“Federal Reserve”) (together, the “Agencies”) jointly published in the Federal Register a notice of proposed rulemaking (“NPR”) to amend the Agencies’ respective regulations exempting certain small loans from the special appraisal requirements that apply to lenders in connection with making higher-priced mortgage loans (“HPMLs”). Under the current HPML rules, the small loan exemption threshold is adjusted annually based on any annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (“CPI-W”), as calculated and published by the Bureau of Labor Statistics (“BLS”). The NPR proposes specifically to amend the official commentary to HPML rules to clarify how the threshold is calculated when the CPI-W does not increase in a given year.

The current HPML rules provide that the small loan threshold amount for exemption from the HPML appraisal requirements is adjusted each January 1 based on any annual percentage increase in the CPI-W, measured year-over-year as of the prior June 1. Thus, if BLS data as of June 1, 2017, showed an increase in the CPI-W since June 1, 2016, the small loan threshold amount would be adjusted accordingly, effective January 1, 2018. The Agencies’ current HPML rules likewise provide that annual adjustments in the threshold amount will be rounded to the nearest $100 increment.