Agencies announce inflation adjustments for Regs M and Z

The CFPB, Federal Reserve Board, and OCC have announced that the 2025 threshold for higher-priced mortgage loans (HPMLs) that are subject to special appraisal requirements will increase from $32,400 to $33,500, effective January 1, 2025. The increase is based on the 3.4 percent annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), as of June 1, 2024.

The change will add paragraph xii. to Official Interpretation comment 35(c)(2)(ii)-3.

The CFPB and the Federal Reserve Board have also announced the dollar thresholds used to determine whether certain credit and lease transactions in 2025 will be subject to certain protections under Regulation Z (Truth in Lending) and Regulation M (Consumer Leasing).

Based on the CPI-W increase noted above, Regulation Z and Regulation M generally will apply to consumer credit transactions and consumer leases of $71,900 or less in 2025 (private education loans and loans secured by real property or by personal property used or expected to be used as the principal dwelling of the consumer, such as mortgages, are subject to Regulation Z regardless of the amount of the loan). The changes will add paragraph 3(b)-3.xvi. to the Official Interpretations of Regulation Z and paragraph 2(e)-11.xvi. to the Official Interpretations of Regulation M.

Each of the changes above has been made to the BankersOnline Regulations pages.