CFPB Issues Revised Version of Prime Offer Rate Methodology

The Consumer Financial Protection Bureau (CFPB) recently announced a revised version of its Methodology for Determining Average Prime Offer Rates, which describes the calculations used to determine average prime offer rates (APOR) for purposes of federal mortgage rules.

APORs are annual percentage rates derived from average interest rates, points, and other loan pricing terms currently offered to consumers by a representative sample of creditors for mortgage loans that have low-risk pricing characteristics.

The methodology statement has been revised to address the upcoming unavailability of certain data the CFPB previously relied on to calculate APORs. On or after April 21, 2023, the CFPB will begin using ICE Mortgage Technology data and the CFPB’s revised methodology to calculate APORs.

The CFPB will continue to post the survey data used to calculate APORs on the Federal Financial Institutions Examination Council’s website.

To read the full report, click here.