We as a Bank have made the decision to not make HOEPA loans due to the new requirements. My question is, if we can't make a HOEPA loan, is it okay to lower the rate and/or fees to in turn lower the APR below the threshold so the loan isn't a HOEPA loan? I'm concerned about a fair lending issue or a violation for trying to skirt around HOEPA status. We have a current situation where the customer is renewing a matured loan and the balance is less than $6,000 and the rate is on the higher end due to their credit scores so of course, the APR puts this loan in HOEPA status. What do we do?

The bank I currently work for doesn't make HPML nor HOEPA loans. They were critized prior to my coming here for lowering fees, but the examiners thus far have been okay with lowering the rate.

You may hear Fair Lending screamed based on this practice or by the method/amount in which you lower it. We lower in increments of .125. It's consistently done this way so I honestly don't see an issue and it's not controlled by lenders.