On Tuesday, BPI submitted a comment letter on the interagency proposal to revise the definition of High Volatility Commercial Real Estate (“HVCRE”) exposures, in line with the requirements contained in the Economic Growth, Regulatory Relief, and Consumer Protection Act. The letter offers recommendations for the clarification of the revised HVCRE exposure definition’s applications, including in loans secured by land intended to remain undeveloped, as well as in certain loans financing condominium construction and lot development secured by one- to four-family residential properties. The letter further provides suggestions for the “as completed” appraisal value component of the borrower-contributed capital exclusion, as well as updates that should be made to the agencies’ HVCRE-specific FAQs. Lastly, the letter requests that the agencies consider eliminating the regulatory classification of HVCRE exposures after a review and assessment of the scope of exposures that would remain classified as HVCRE per the revised definition.
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