HMDA Proposed Rule Change - Again!
by Amy Kleinschmit
Chief Compliance Officer

The Consumer Financial Protection Bureau (CFPB) is tackling HMDA, as implemented in Regulation C, again by issuing a proposed rule and an advance noticed of proposed rulemaking.

First, the proposed rule, which can be found here, relates to the coverage thresholds and partial exemptions. This proposed rule is open for a 30 day comment period.

With regard to closed-end mortgage loans, the CFPB is proposing to increase the threshold for reporting data about closed-end mortgage loans so that institutions originating fewer than either 50 closed-end mortgage loans, or alternatively 100 closed-end mortgage loans, in either of the two preceding calendar years would not have to report such data as of January 1, 2020.

The CFPB seeks comment on whether the data that would be reported at thresholds of 50 or 100 closed-end mortgage loans would achieve the purposes of HMDA. It also seeks comment on whether the value of the data that would be reported by institutions that originate between 25 and 50 closed-end mortgage loans, or alternatively between 25 and 100 closed-end mortgage loans, is outweighed by the burden on those institutions of reporting HMDA data and undergoing examinations to validate the accuracy of their submissions.

The proposed rule would also adjust the threshold for reporting data about open-end lines of credit by extending to January 1, 2022, the current temporary threshold of 500 open-end lines of credit and setting the threshold at 200 open-end lines of credit upon the expiration of the proposed extension of the temporary threshold.

The proposed rule also would implement Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155) partial exemptions. The CFPB has issued an “unofficial” redlined version of the proposed rule to reflect this changes, which can be found here.

Advanced Notice of Proposed Rulemaking.

Next, the ANPR, which can be found here is open for a 60 comment period. The CFPB is issuing this ANPR to solicit comments relating to whether to make changes to (1) the data points that the 2015 HMDA Rule added to Regulation C or revised to require additional information, and (2) Regulation C’s coverage of business- or commercial purpose loans made to a non-natural person and secured by a multifamily dwelling.

The CFPB proposes a number of questions relating to the data points that begin on page 13 of the ANPR at the link above. Any information and data that can be provided relating to the costs of HMDA, especially the data points added pursuant to discretionary authority (see chart on page 13 of ANPR) would be helpful. You do not have to answer all the questions, any feedback is appreciated and can be submitted directly to the CFPB. An example of the first question – “Please identify any new data point or any data point revised to require additional information from the table above for which the cost of collecting and reporting the information does not justify the benefit that the information collected and reported provides in furthering the purposes of HMDA.”

As always, CUAD members may contact Amy Kleinschmit with any compliance related questions.



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