Small creditor escrow exemption SNAFU

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Question:

My bank is a small creditor who makes HPMLs. We’ve been claiming the escrow exemption, but now I’m not so sure we should. Sometimes we set up accommodation escrows for extenuating circumstances – does that cause problems?

Answer:

Yes! Under 1026.35 rules, the small creditor escrow exemption requires you pass all criteria of a four-part test. If you escrow for anything other than old HPMLs or defaulting borrowers, then you may not claim this exemption! Tune into the upcoming webinar “Hey HPML! What’s the Matter with QMATR, eh?” on August 5, 2020 to learn more about this often misunderstood HPML rule.

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Learn more about Rebekah Leonard’s webinar Hey HPML! What’s the Matter with QMATR, eh?