Which of the following is NOT a trigger for high-cost lending?

In the context of high-cost lending, certain thresholds must be met for loans to be classified as high-cost under the Home Ownership and Equity Protection Act (HOEPA). The key factors typically considered include the interest rates on the loans and the associated fees.

When evaluating the options, the distinction lies in the application of the fee triggers based on the loan amount. Generally, a loan under $20,000 is less likely to fall under the stringent definitions and protections of high-cost lending, making the fee trigger of 5% for loans under that amount not a trigger for high-cost lending.

In contrast, the other options present scenarios where high-cost characteristics are likely met: a first mortgage with an interest rate of 6.5% exceeds conventional thresholds, and an 8.5% interest rate on a second mortgage also clearly qualifies as high-cost. Loans over $20,000 with a 5% fee trigger are relevant for determining high-cost status as well, as they meet the criteria for triggering HOEPA protections.

Thus, the selection revolves around identifying what does not fall into the high-cost threshold, which is appropriately represented by the 5% fee for loans under $20,000.