I need a little clarification on HPMLs. If you run the FFIEC rate spread calculator and the end result rate spread is above 1.50%, is this not a High Priced Mortgage Loan?

I have seen a HPML Checklist & Worksheet where it plugs in certain numbers and it ends up stating the loan is NOT an HPML loan even though the spread is above the 1.50%

1.5 points for a first lien; 3.5 for a subordinate lien. Maybe the loan you are looking at is a subordinate lien?

No, it is a first position mortgage.. i just wanted to know if the rate spread calculator shows the spread is over 1.5%, does this mean the loan is a HPML irregardless of any other requirements?

You by chance aren't using the HOEPA worksheet are you? They are two entirely different animals.

http://www.bankerscompliance.com/assets/files/documentation/HOEPA%202009-1.xls

If it's secured by the primary residence of the borrower(s), can't be exempted from Sec. 35 of Reg Z as temporary financing, or exempted from Reg Z altogether, yes.

HPML - exemptions are noted in 226.35(a)(3)

1st lien - 1.5% or greater

Subordinate lien - 3.5% or greater


HOEPA - exemptions are noted in 226.32(a)(2)

1st lien - 8% or greater

Subordinate lien - 10% or greater

so to reconfirm, if the FFIEC rate spread calculator reflects a spread that is over 1.5%, that means the loan is a HPML right?

Yes, but just to clarify. If you plug the numbers into the FFIEC rate calculator and the calculator gives you ANY number back, then that number is the rate spread and the loan is a HPML. The calculator factors in the applicable threshold when doing the calculation so you don't have to determine. Only if you get back "N/A" is the loan then below the threshold and is not HPML.