Our January 30, 2015, memorandum is hereby revised to reflect that on February 11, 2015, the Consumer Financial Protection Bureau (CFPB) published in the Federal Register (80 FR 7770) a proposed rule (click here) to amend §1026.35 (Higher-Priced Mortgage Loans), §1026.43 (Ability to Repay/Qualified Mortgage) and their Official Interpretations in Regulation Z to facilitate lending by small creditors, particularly in rural and underserved areas. As stated in the CFPB’s January 30, 2015 press release, the proposed rule would: • Expand the definition of “small creditor”: Under the proposal, the loan origination limit for small-creditor status would be raised from 500 first-lien mortgage loans to 2,000 and would exclude loans held in portfolio by the creditor and its affiliates. • Include mortgage affiliates in calculation of small-creditor status: The proposal would not change the current asset limit for small-creditor status, which is set at less than $2 billion (adjusted annually) in total assets as of the end of the preceding calendar year. However, the proposal would include the assets of the creditor’s mortgage-originating affiliates in calculating whether a creditor is under the limit.

Complete Memorandum