The CFPB adopted amendments to Regulation Z (Truth in Lending) to provide certain insured depository institutions and credit unions with an exemption from establishing escrow accounts for higher-priced mortgage loans ("HPMLs").
The exemption will be available only to an HPML secured by a "first lien on the principal dwelling of a consumer." (See previous coverage.) An institution relying on the exemption must (i) have assets totaling not more than $10 billion, (ii) have provided no more than 1,000 loans secured by a first lien on a principal dwelling during the previous calendar year and (iii) meet a number of the existing HPML escrow exemption criteria.
The final rule will go into effect on the date of its publication in the Federal Register.
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