CFPB Adjusts Regulation Z (Truth in Lending) Asset-Size Exemption Threshold
January 7, 2026 / Source: Consumer Financial Protection Bureau
This rule amends Regulation Z (Truth in Lending) to implement certain amendments to the Truth in Lending Act made by the Dodd-Frank Act. This rule amends the official commentary that interprets the requirements of the Bureau’s Regulation Z (Truth in Lending) to reflect changes in the asset-size thresholds for certain creditors to qualify for an exemption to the requirement to establish an escrow account for a higher-priced mortgage loan. These changes reflect updates to, together with affiliates that regularly extended covered transactions secured by first liens, had total assets of less than $2 billion (adjusted annually for inflation) and the exemption the Bureau added, by implementing section 108 of the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA), for certain insured depository institutions and insured credit unions with assets of $10 billion or less (adjusted annually for inflation). These amendments are based on the annual percentage change in the average of the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).
Annual adjustments
- For certain first-lien higher-priced mortgage loans, the exemption threshold is adjusted to increase to $2.785 billion from $2.717 billion. Therefore, creditors with assets of less than $2.785 billion (including assets of certain affiliates) as of Dec. 31, 2025, are exempt, if other requirements of Regulation Z also are met, from establishing escrow accounts for higher-priced mortgage loans in 2026. This asset limit will also apply during a grace period, in certain circumstances, with respect to transactions with applications received before April 1 of 2027. For certain insured depository institutions and insured credit unions meeting certain conditions, including an asset size exemption threshold, the exemption threshold is adjusted to increase to $12.485 billion from $12.179 billion. Therefore, insured depository institutions and insured credit unions that during calendar year 2025 had assets of $12.485 billion or less on December 31, 2025, will meet the asset-size exemption threshold for purposes of any loan consummated in 2026 and for purposes of any loan secured by a first lien on a principal dwelling of a consumer consummated in 2027 for which the application was received before April 1, 2027. These adjustments are based on the 2.5 percent increase in the average of the CPI-W for the 12-month period ending in November 2025.