Proposal would clarify HMDA data collection, report

A proposal clarifying the information financial institutions are required to collect and report about their mortgage lending – helping them, in turn, comply with Home Mortgage Disclosure Act (HMDA) rules – was issued today by the CFPB.

The 150-page proposal, CFPB said in a statement, contains a number of clarifications, technical corrections and minor changes to the HMDA regulations. Those include clarifying certain key terms – such as “temporary financing” and automated underwriting system” – and establishing transition rules for reporting certain loans purchased by financial institutions. Other changes would facilitate reporting the census tract of a property, using a new geocoding tool the CFPB says it plans to provide online.

CFPB said that the proposal – issued for a 30-day comment period – resulted from public outreach and engagement which identified opportunities to clarify parts of its 2015 HMDA final rule. The agency was directed by the Dodd-Frank Wall Street Reform and Consumer Protection Act to update the HMDA regulation, which it did in 2015, to improve the quality and type of information reported by financial institutions. Most of those updated requirements take effect next year (2018).

CFPB noted that the public and regulators can use the information gathered via HMDA regulations to monitor whether financial institutions are serving the housing needs of their communities, to assist in distributing public-sector investment so as to attract private investment to areas where it is needed, and to identify possible discriminatory lending patterns.

Technical Corrections and Clarifying Amendments to the Home Mortgage Disclosure (Regulation C) October 2015 Final Rule