2026 rule background. This explainer covers an announcement made on December 15, 2025, rather than a new mortgage-rate update.
What changed?
For 2026, the small-loan exemption threshold for special appraisal requirements on higher-priced mortgage loans is $34,200, up from $33,500 in 2025. The change took effect January 1, 2026.
What does that mean in plain English?
An appraisal is an estimate of a home’s value. Certain higher-priced mortgages have special appraisal requirements. A loan at or below the 2026 threshold is exempt from those particular requirements.
This exemption does not promise that every lender will skip an appraisal or that every appraisal rule disappears. Ask your lender what valuation is required for your particular loan and what it will cost.
Does it apply to a refinance?
The amount of the new loan matters. An older loan’s exemption does not automatically carry over when it is refinanced. For example, a new $40,000 loan exceeds the $34,200 threshold, even if the old loan was smaller. Another exemption may apply, depending on the transaction.
Review the appraisal charge on your Loan Estimate when comparing offers. This threshold alone does not tell you whether refinancing will save money.
Sources: CFPB announcement, annual threshold adjustments, and Regulation Z section 1026.35(c)(2)(ii) and its official interpretation. Reviewed October 4, 2026.
General mortgage education. This is not a determination that your loan qualifies for an exemption.