Hi Carrie. The definition of small servicer is found in Regulation Z, 12 CFR 1026.41(e):
(4) Small servicers. (i) Exemption. A creditor, assignee, or servicer is exempt from the requirements of this section for mortgage loans serviced by a small servicer.
(ii) Small servicer defined. A small servicer is a servicer that either:
(A) Services 5,000 or fewer mortgage loans, for all of which the servicer (or an affiliate) is the creditor or assignee; or
(B) Is a Housing Finance Agency, as defined in 24 CFR 266.5.
(iii) Small servicer determination. In determining whether a small servicer services 5,000 or fewer mortgage loans, a servicer is evaluated based on the number of mortgage loans serviced by the servicer and any affiliates as of January 1 for the remainder of the calendar year. A servicer that crosses the threshold will have six months after crossing the threshold or until the next January 1, whichever is later, to comply with any requirements for which a servicer is no longer exempt as a small servicer.
The link to the regulation is here: https://www.ecfr.gov/cgi-bin/text-idx?SID=0502519f6a0cfb1d719118337266cbc8&node=20130214y1.75