A covered loan consummated in 2026 has a $118,000 loan amount and $4,100 in total points and fees as counted under Regulation Z. Does it satisfy the qualified-mortgage points-and-fees cap for its loan-size tier?
Correct Answer
B) Yes; the applicable 2026 cap is $4,139, so $4,100 is below it
B. The $4,100 amount passes the applicable $4,139 cap by $39. $118,000 falls between $82,775 inclusive and $137,958 exclusive in the 2026 table. That tier uses a fixed dollar cap, not a 3% or 5% calculation. Scope and exceptions: Use the consummation year and the regulation's points-and-fees definitions, not all closing costs indiscriminately. Passing this one test does not establish that every qualified-mortgage condition is satisfied. Source: Section 1026.43(e)(3); comment 43(e)(3)(ii)-1.xi–xii — https://www.consumerfinance.gov/rules-policy/regulations/1026/43/
Why This Is the Correct Answer
B. The $4,100 amount passes the applicable $4,139 cap by $39. $118,000 falls between $82,775 inclusive and $137,958 exclusive in the 2026 table. That tier uses a fixed dollar cap, not a 3% or 5% calculation. Scope and exceptions: Use the consummation year and the regulation's points-and-fees definitions, not all closing costs indiscriminately. Passing this one test does not establish that every qualified-mortgage condition is satisfied.
Why the Other Options Are Wrong
Option A: Yes; a 5% cap applies, limiting points and fees to $5,900
Five percent belongs to a different loan-size tier.
Option C: No; a 3% cap applies, limiting points and fees to $3,540
Three percent is not the applicable tier.
Option D: No; the applicable 2026 cap is $4,045
$4,045 is the corresponding 2025 cap, not the 2026 figure.
Exam Tip
Select year and size tier before comparing points and fees.
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