A compliance guide for small-entity compliance with the Home Mortgage Disclosure Act (HMDA) was updated for changes due to this year’s regulatory relief law and issued Tuesday by the Bureau of Consumer Financial Protection (BCFP, formerly known as CFPB).
The bureau’s “Small Entity Compliance Guide” gives an overview of the Aug. 31 interpretive and procedural rule to implement and clarify changes made to HMDA by section 104(a) of the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA, S. 2155). EGRRCPA provides partial exemptions from HMDA’s data collection and reporting requirements. The changes:
- exempt an insured depository institution or insured credit union does not need to collect or report certain data with respect to closed-end mortgage loans if it originated fewer than 500 closed-end mortgage loans in each of the two preceding calendar years; and
- exempt an insured depository institution or insured credit union does not need to collect or report certain data with respect to open-end lines of credit if it originated fewer than 500 open-end lines of credit in each of the two preceding calendar years.
The partial exemptions are unavailable to an insured depository institution if it received a rating of “needs to improve record of meeting community credit needs” during each of its two most recent Community Reinvestment Act (CRA) examinations or a rating of “substantial noncompliance in meeting community credit needs” on its most recent CRA examination.
The bureau’s interpretive and procedural rule:
- Clarifies which data points in Regulation C (the HMDA regulation) are covered by the partial exemptions.
- Clarifies that only loans and lines of credit that are other wise reportable under Regulation C count toward the thresholds for the partial exemptions.
- Clarifies the exception to the partial exemptions for negative CRA examination history.
- Designates a non-universal loan identifier for certain partially exempt transactions.
- Clarifies that insured depository institutions and insured credit unions that qualify for a partial exemption may optionally report exempt data points so long as they report all data fields that the data point comprises.
The rule took effect Sept. 7.