Regarding HOEPA, the Reg indicates as follows:


Regulation Z 1026.32
ii) The total points and fees payable by the consumer at or before loan closing will exceed the greater of 8 percent of the total loan amount, or $400; the $400 figure shall be adjusted annually on January 1 by the annual percentage change in the Consumer Price Index that was reported on the preceding June 1.

I just received an email that the CFPB and the Fed increased the threshold. This is confusing as the reg doesn't indicate "whichever is less".

Reg. Z's transaction "points and fees" threshold, the dollar amount triggering HOEPA's additional consumer protections is raised to the greater of $625.00 or 8 percent of the loan amount, whichever is less.

The confusion stems from the new wording added by the Fed and CFPB "whichever is less".

That makes no sense.

That "whichever is less" phrase is lifted straight out of the prefatory material that accompanied the publication of the amendment in the Federal Register. See 77 FR 69739 (2nd page of the PDF), middle column, in the paragraph that continues from the first column. As bike4life says, it makes no sense.

It should be noted that this change is not one that the FRB joined the Bureau on. So to give the Bureau the benefit of the doubt, I looked back at the last such adjustment, which was made by the Fed, wondering if the Bureau "borrowed" its prefatory wording from the Fed. The offending phrase does not appear in the the Fed's FR document, at 76 FR 35723. It also doesn't appear in the regulation or commentary, so I recommend you simply ignore it.

[/b][b]

I have a feeling we'll be saying that a lot 'come January 21...