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Regulation Z thresholds 2026: HOEPA, QM, HPML

The 2026 Regulation Z thresholds beside the 2025 ones: HOEPA at $27,592 and $1,380, the QM points-and-fees bands, and the HPML appraisal exemption at $34,200.

Published 2026-09-18

For 2026 the Home Ownership and Equity Protection Act of 1994 (HOEPA) total loan amount threshold is $27,592 and the HOEPA points-and-fees dollar trigger is $1,380. The higher-priced mortgage loan (HPML) appraisal exemption is $34,200. Those Regulation Z thresholds for 2026 come from two final rules, the Consumer Financial Protection Bureau’s (CFPB) at 90 FR of December 15, 2025 and a joint rule of the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System and the CFPB at 90 FR of December 16, 2025, both effective January 1, 2026. Every one of those figures was a different number in 2025, and a threshold quoted without its year is wrong even when the digits are right.

The 2026 figures beside the 2025 figures

Threshold20252026
HOEPA total loan amount, s. 1026.32(a)(1)(ii)$26,968$27,592
HOEPA points-and-fees dollar trigger$1,348$1,380
Qualified mortgage (QM) 3% points-and-fees band, loan at or above$134,841$137,958
QM fixed dollar cap on the next band down$4,045$4,139
QM band boundary, loan at or above$80,905$82,775
QM 5% band, loan at or above$26,968$27,592
QM fixed dollar cap on the small-loan band$1,348$1,380
QM 8% band, loan below$16,855$17,245
HPML appraisal exemption, s. 1026.35(c)(2)(ii)$33,500$34,200
HPML escrow exemption, small creditor assets$2.717 billion$2.785 billion
HPML escrow exemption, insured institution assets$12.179 billion$12.485 billion
Regulation C asset-size exemption$58 million$59 million

Each figure moves by an index the regulation itself names. The HOEPA and QM amounts follow the Consumer Price Index (CPI) reported the preceding June 1. The HPML appraisal exemption, the escrow asset-size thresholds and the Regulation C threshold follow the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The CPI-W change the CFPB used for the two asset-size rules was 2.5 percent, the year-to-year change in the average CPI-W for the 12 months ending November 2025.

What the two HOEPA numbers do

A high-cost mortgage under 12 CFR s. 1026.32(a)(1) is a consumer credit transaction secured by the consumer’s principal dwelling that fails any one of three tests: an annual percentage rate (APR) test, a points-and-fees test, or a prepayment penalty test. The dollar figures sit in the points-and-fees test at s. 1026.32(a)(1)(ii).

The regulation writes the test in unindexed terms: total points and fees may not exceed 5 percent of the total loan amount for a loan of $20,000 or more, or the lesser of 8 percent of the total loan amount or $1,000 for a loan under $20,000, with both figures adjusted every January 1. The 2026 values of those two figures are $27,592 and $1,380. For 2025 they were $26,968 and $1,348. The APR test and the prepayment penalty test carry no indexed dollar amount, so they do not move: the APR must exceed the average prime offer rate (APOR) by more than 6.5 percentage points on a first lien, by more than 8.5 on a first lien where the dwelling is personal property and the loan amount is under $50,000, a figure the regulation does not index, and by more than 8.5 on a subordinate lien.

APOR is the CFPB’s published average of rates, points and other pricing terms currently offered by a representative sample of creditors for low-risk transactions, defined at s. 1026.35(a)(2) and republished at least weekly.

The five QM points-and-fees bands

Section 1026.43(e)(3) caps total points and fees on a qualified mortgage in five bands, each band keyed to the loan amount and each figure indexed. For 2026 the bands read: 3 percent of the total loan amount at $137,958 and above; $4,139 from $82,775 up to $137,958; 5 percent from $27,592 up to $82,775; $1,380 from $17,245 up to $27,592; and 8 percent below $17,245.

The General QM definition also sets APR-over-APOR spreads, and those percentage points held steady into 2026 while the loan amounts under them moved: 2.25 points for a first lien at $137,958 or more, 3.5 points for a first lien from $82,775 up to $137,958 or a subordinate lien at $82,775 or more, and 6.5 points for a first lien under $82,775, for a first-lien manufactured home loan under $137,958, or for a subordinate lien under $82,775.

$34,200 buys an appraisal exemption in 2026

Section 1026.35(c) carries the special appraisal rules for a higher-priced mortgage loan: a written appraisal by a certified or licensed appraiser after a physical interior visit, a free copy to the consumer, and a second appraisal on certain quick resales. Section 1026.35(c)(2)(ii) exempts a loan at or below an indexed amount. The Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System and the CFPB set that amount at $34,200 for 2026, up from $33,500 in 2025, effective January 1, 2026.

The definition the exemption hangs off is at s. 1026.35(a)(1): a closed-end transaction secured by the principal dwelling with an APR 1.5 percentage points or more over APOR on a first lien within the Freddie Mac purchase limit, 2.5 points or more on a first lien above that limit, or 3.5 points or more on a subordinate lien.

Asset-size exemptions under Regulation Z and Regulation C

Section 1026.35(b)(1) requires an escrow account on a first-lien HPML. Section 1026.35(b)(2)(iii) lets a small creditor out of it, and one of its conditions is an asset size below an indexed amount: $2.785 billion for 2026, against $2.717 billion for 2025. Section 1026.35(b)(2)(vi), added in 2021 under the Economic Growth, Regulatory Relief, and Consumer Protection Act, exempts an insured depository institution or insured credit union with assets at or below $12.485 billion for 2026, against $12.179 billion for 2025. That exemption carries a second condition: the institution and its affiliates originated 1,000 or fewer loans secured by a first lien on a principal dwelling in the preceding calendar year. The CFPB’s rule setting both thresholds was effective January 7, 2026, and the same $2.785 billion figure carries into the small-creditor portfolio QM at s. 1026.43(e)(5) and the balloon-payment QM at s. 1026.43(f)(1)(vi).

Regulation C (12 CFR Part 1003) runs on its own threshold. Section 1003.2(g) makes a depository institution a financial institution for Home Mortgage Disclosure Act (HMDA) reporting only where its assets on the preceding December 31 exceeded the published threshold. That threshold rose to $59 million from $58 million, effective January 7, 2026: an institution with assets of $59 million or less on December 31, 2025 is exempt from collecting data in 2026.

The notices behind the 2026 figures

Every figure above is the product of a dated Federal Register notice. The 2026 cycle took three dates: December 15 and December 16, 2025, and January 7, 2026. The 2027 figures will come from notices of the same kind. The MLO Testing Handbook’s chapter on legislative updates says candidates answer from the current statutes, regulations and rules and are responsible for keeping up with changes, whether or not a change appears on the content outline (MLO Testing Handbook, 6.2 Legislative Updates). So the usable form of any figure here is “$27,592, HOEPA total loan amount, 2026, set by the December 15, 2025 notice”.

Regulation Z and the Truth in Lending Act are named in the content outline under Federal Mortgage-Related Laws, the content area that carries 24 percent of the SAFE Mortgage Loan Originator Test, National Component with Uniform State Content (MLO Testing Handbook, 6.1 Content Outline, part 1). The same area feeds the federal laws practice set on this site.

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