The Consumer Financial Protection Bureau is seeking public comments regarding proposed changes to the 2015 Home Mortgage Disclosure Act rule.
The CFPB’s proposed rule includes a number of clarifications, technical corrections and minor changes to the updated HMDA regulation. The changes are designed to help financial institutions comply with the 2015 final rule by clarifying the information they are required to collect and report about their mortgage lending practices, according to an April 13 CFPB news release.
The proposed changes clarify key terms, establish transition rules for reporting certain loans purchased by financial institutions, and facilitate the reporting of census tract data using a new online tool, the release stated.
The proposal reflects the “bureau’s ongoing and substantive engagement with stakeholders in the marketplace, and will help industry meet its new reporting obligations,” CFPB Director Richard Cordray said in the release.
Originally enacted in 1975, the Home Mortgage Disclosure Act requires many lenders to report information about the home loans for which they receive applications or that they originate or purchase. Regulators use this information to monitor how financial institutions are serving the housing needs of their communities, to encourage investment in underserved communities, and to identify possible discriminatory lending patterns, according to the release.
As required by the Dodd-Frank Act, the CFPB updated the HMDA regulation in 2015 to improve the quality and type of data financial institutions report, the release stated. Most of the updated requirements are scheduled to take effect in January 2018.
“Through outreach, we have learned that there are parts of the 2015 HMDA final rule that we could clarify, which would help financial institutions comply and would improve the data,” Terry J. Randall, senior counsel for the CFPB, wrote in an April 13 blog post on the bureau’s website. “The CFPB is committed to well-tailored and effective regulations and has sought to carefully calibrate its efforts to ensure consistency with respect to consumer financial protections across the financial services marketplace.”
The proposal will be open for public comment for 30 days after publication in the Federal Register. To view the proposed rule, click here.
National Association of Federally-Insured Credit Unions President and CEO Dan Berger issued a statement April 13 regarding the CFPB’s proposed HMDA rule changes.
“NAFCU appreciates the clarifications proposed by the CFPB regarding its HMDA rule,” Berger said in the statement. “However, the rule still represents a huge regulatory burden for credit unions. NAFCU strongly encourages the bureau to reconsider its enormous expansion of the HMDA data collection set, raise the exemption thresholds and delay implementation of this rule to give credit unions more time to prepare.”