OCC Issues Two Proposals on Preemption of State Interest-on-Escrow Laws — 2025-12-23

WASHINGTON—The Office of the Comptroller of the Currency (OCC) today requested comment on two proposals on national banks’ and federal savings associations’ real estate lending powers related to the payment of interest on funds held in escrow accounts. The OCC’s actions emphasize federal preemption as a critical tool for reducing unnecessary burden, enabling local and national prosperity, and unleashing economic growth. The OCC is proposing to codify longstanding powers of national banks and federal savings associations to establish or maintain real estate lending escrow accounts and to exercise flexibility in making business judgment as to the terms and conditions of such accounts, including whether and to what extent to offer any compensation paid to customers or to assess any related fees. Codifying this longstanding power will provide clarity and reduce uncertainty with regards to bank escrow practices and may thereby incentivize increased bank real estate lending.