0 CFPB, Federal Agencies, State Agencies, and Attorneys General. The Bureau issued an interpretive and procedural rule in 2018 (2018 HMDA Rule) to implement and clarify the requirements of section 104(a) of the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA), which was enacted in May 2018 and amended HMDA by adding partial exemptions from certain reporting requirements. Request for Information Regarding the HMDA Rule Assessment The Bureau recognizes that it faces challenges in its assessment, as it may be difficult to quantify certain components such as the benefits of the [43] Published: May 17, 2021. If there is a disproportionate prevalence of high-interest loans (e.g. CFPB officials noted the agency will continue to produce and share information with the other regulators on an annual basis moving forward. Please note that due to circumstances associated with the COVID-19 pandemic, the Bureau discourages the submission of comments by hand delivery, mail, or courier. PDF New Rule Summary: Home Mortgage Disclosure (Regulation C) applications by certain races (e.g. PDF WHO MUST REPORT HMDA institutional coverage 9. implicit or referral based discrimination, where a discriminatory HMDA generally requires mortgage lenders to collect and report certain information from loan applications and originations. Is There a Gender Gap in Home Equity Loans? About HMDA. scrutiny for its effectiveness. See Mail/Hand Delivery/Courier: In the 2015 HMDA Final Rule, the Bureau implemented the Dodd-Frank Act amendments to HMDA and made other changes to Regulation C. Most of the 2015 HMDA Final Rule took effect on January 1, 2018. The Home Mortgage Disclosure Act (HMDA) requires many financial institutions to maintain, report, and publicly disclose loan-level information about mortgages. F. The FHA prohibits your institution from denying loans for the purpose of ___________ a house because of an applicant's race, color, religion, national origin, handicap, familial status, or sex. 84 FR 649 (Jan. 31, 2019). 82 FR 43088 (Sept. 13, 2017); 84 FR 57946 (Oct. 29, 2019). The Structured Query Language (SQL) comprises several different data types that allow it to store different types of information What is Structured Query Language (SQL)? since risk management policies at many financial institutions are The OFR/GPO partnership is committed to presenting accurate and reliable 4. Lenders that meet specific statutory criteria are required to report certain data under HMDA, but are exempt from reporting almost all of the new additional HMDA data--referred to as partial exemption from HMDA reporting. The 2015 HMDA Final Rule thus sought to address gaps in the HMDA data regarding certain segments of the market. 12 CFR 390.147. Additionally, the Bureau believes that, based on the modifications to reporting requirements adopted in the 2017, 2018, 2019, and the 2020 rules, it may be difficult to isolate the separate effects of each of the 2015 HMDA Final Rule and the related subsequent rules during this assessment. Comments delineating and describing the ongoing costs incurred in collecting and reporting information for the HMDA Rule. Major Goals and History, Truth in Lending Act (TILA): Consumer Protections and Disclosures, National Housing Act: Overview, Impact, Criticisms, Consumer Financial Protection Bureau (CFPB), Federal Financial Institutions Examination Council (FFIEC). Are they significantly different from those delineated in the published Report of the Small Business Review Panel mentioned above? The lenders are required to maintain and disclose their yearly data on the communities they serve and specific borrower characteristics. Your credit union had a home or branch office in a Metropolitan Statistical Area on December 31, 2020; Your credit union originated at least one . List of Excel Shortcuts Start Printed Page 66229. The Bureau has determined that considering all of these rules together will facilitate a more meaningful assessment of the HMDA Rule. for Home Mortgage Disclosure Act-related data collected in 2020 and reported in 2021. If so, how and how much? The NMDB is an ongoing project, jointly undertaken by the Federal Housing Finance Agency (FHFA) and the Bureau, with the goal of providing the public and regulatory agencies with data that does not include any personally identifiable information but that otherwise may service as a comprehensive resource about the U.S. mortgage market. With regard to the recording of HMDA data, newly excluded institutions still must record closed-end mortgage loan data for the first quarter of 2020 on their loan application registers within 30 days after the end of the first quarter. edition of the Federal Register. The 2015 HMDA Final Rule also modified the types of data that institutions are required to collect and report by adding new data points to Regulation C and revising certain pre-existing data points. At the local level, in the vast majority of census tracts, at least 91 percent of data GAO reviewed were available in 2019 (see figure). Regulation C requires financial institutions to report HMDA data. It is not an official legal edition of the Federal A Proposed Rule by the Consumer Financial Protection Bureau on 11/22/2021. Until the ACFR grants it official status, the XML Legal Entity Identifier. Document Drafting Handbook Thus, one purpose of HMDA and Regulation C is to provide the public with information that will help show whether financial . 1 0000004246 00000 n HMDA requires financial institutions to collect and report information about mortgage loans, which HMDA section 303(2) defines as loans secured by residential real property or home improvement loans. The assessment also must reflect available evidence and any data that the Bureau reasonably may collect. mortgage loans. In 2018, Congress enacted the EGRRCPA. However, newly excluded institutions may opt to report data for 2020, but to do so they must report data for the entire year. This data also allows regulators, public officials, and consumer watchdogs to monitor trends in mortgage borrowing and lending for compliance with fair housing and other laws and to direct housing investment and government funding to areas where it is needed. Congress believed that some financial institutions had contributed to the decline of some geographic areas by their failure to provide adequate home financing to qualified applicants on reasonable terms and conditions. [44] "Home Mortgage Disclosure (Regulation C)," Page 112. The 2018 HMDA Rule and 2019 HMDA Final Rule clarified which of the data points in Regulation C are covered by the EGRRCPA partial exemptions. The Director of CFPB should provide the federal financial regulators with additional information in its analysis to help them oversee lenders' eligibility for partial exemptions and related HMDA reporting. This information is not part of the official Federal Register document. xref African Americans), ethnicities [39] Congress should consider requiring all HMDA reportersincluding those with partial exemptionsto report whether loans are open-end lines of credit. Since 2018, the Home Mortgage Disclosure Act requires lenders to report additional data from loan applications and originationssuch as borrower credit scoresto help regulators oversee and enforce fair lending laws. These include white papers, government data, original reporting, and interviews with industry experts. LARs to members of the public upon request. the prevailing rates at the time of the application), Lien status of the loan (1st or 2nd lien). %%EOF [24] 0000045243 00000 n It is important to understand that Accessed Aug. 8, 2021. More information and documentation can be found in our 12. to suspect that the institution may be discriminating against these Rather, redlining must be quite overt to draw attention The Bureau is interested in any information about activities and outcomes including the ones listed below and is interested in understanding how these activities and outcomes relate to each other: (1) Industry outcomes that the HMDA Rule may have affected, including the number and types of reporters, the number of loans, and the dollar amounts for reported open-end lines of credit and closed-end mortgage loans; (2) The activities undertaken by financial institutions to comply with the HMDA Rule's criteria, as well as the adoption of loan-volume coverage thresholds, adoption of new and revised data points, and revisions to transactional coverage, including mandatory reporting of open-end lines of credit and the adoption of a dwelling-secured standard; (3) Overall benefits and other outcomes that the HMDA Rule sought to affect, including whether the HMDA Rule has brought greater transparency to the mortgage market, has helped determine whether financial institutions are serving the housing needs of their communities, has assisted public officials in distributing public-sector investment so as to attract private investment to areas where it is needed, assisted in identifying possible discriminatory lending patterns and enforcing antidiscrimination statutes, and addressed gaps in the HMDA data regarding certain segments of the market; (4) An evaluation of the benefits and costs of the new and revised data points, and the benefits and costs of new data reported under the revised coverage thresholds; and. However, there is tension in this arena between attempts by banks to These data help show whether lenders are serving the housing needs of their communities; they give public officials information that helps them make decisions and policies . [7] Mortgage data (HMDA) - Consumer Financial Protection Bureau 0000000016 00000 n In the 2019 HMDA Final Rule, the Bureau extended the temporary increase in the open-end coverage threshold for two additional years, until January 1, 2022. 1503 & 1507. Depository and nondepository institutions must meet certain reporting criteria before they are required to complete a HMDA Loan Application Register (LAR), as a result of applications for, and originations and purchase of home purchase loans (including refinancings and home improvement loans). daily Federal Register on FederalRegister.gov will remain an unofficial Under the current definition, depository institutions that originate one first-lien home purchase loan or refinancing secured by a one- to four-unit dwelling and that meet other criteria for "financial institution" must collect and report HMDA data, while certain nondepository institutions that originate many more mortgage loans annually do . [6] Before publishing a report of its assessment, the Bureau must invite public comment on recommendations for modifying, expanding, or eliminating the significant rule or order.[3]. Upon completion of the assessment, the Bureau anticipates issuing an assessment report not later than January 1, 2023. 0000077063 00000 n r\D p:p{%+^ JWXWW9G1G9G1G9G1G9G1GWW9Snnn7 Fo7 Fo7 kd These data points include the following: The purpose of the loan or application; occupancy type; ethnicity; race; and legal entity identifier (LEI). This site displays a prototype of a Web 2.0 version of the daily Publicly Released: May 17, 2021. Section 1094 of the Dodd-Frank Act amended HMDA and transferred HMDA rulemaking authority and other functions from the Board of Governors of the Federal Reserve System (Board) to the Bureau. it to the public electronically (on CD-ROM and over the internet). However, the Bureau considers the HMDA Rule to be of sufficient importance to support the Bureau conducting a voluntary assessment. 12 CFR 1003.5(a)(1)(ii). Prior to the HMDA Rule, Regulation C covered closed-end, business- or commercial-purpose loans made to purchase, refinance, or improve a dwelling. Financial Modeling & Valuation Analyst (FMVA), Commercial Banking & Credit Analyst (CBCA), Capital Markets & Securities Analyst (CMSA), Certified Business Intelligence & Data Analyst (BIDA), Financial Planning & Wealth Management (FPWM). statutes. 0000002682 00000 n Timothy Li is a consultant, accountant, and finance manager with an MBA from USC and over 15 years of corporate finance experience. 2801(b); Pursuant to those requirements, the Bureau must publish a report of the assessment not later than five years after the effective date of such rule or order. shortages in certain urban neighborhoods. The National Housing Act, passed in 1934 to strengthen the residential real estate market, created the Federal Housing Administration (FHA). Second, the HMDA Rule interpreted HMDA, as amended by the Dodd-Frank Act, to require that the Bureau use a balancing test to determine whether and how HMDA data should be modified prior to its disclosure to the public to protect applicant and borrower privacy while also fulfilling HMDA's public disclosure purposes. The 2020 HMDA Final Rule also increased the closed-end coverage threshold, from 25 to 100 closed-end mortgage loans. Partial exemptions did not disproportionately affect the availability of HMDA data GAO reviewed for borrowers of any race, ethnicity, or income level. While every effort has been made to ensure that The 2015 HMDA Final Rule implemented the new data points specified in the Dodd-Frank Act, added additional data Generally, for the subsequent 2017, 2018, 2019, and 2020 HMDA rules, the Bureau estimated that changes in thresholds and other requirements would represent savings in ongoing costs for affected entities. The HMDA data that lenders with partial exemptions need not report are set in statute. 12 U.S.C. PDF Four Pillars of an Eective HMDA Compliance Program discriminatory lending patterns and enforcing antidiscrimination The CFPB also requested comment on a closed-end loan threshold of 100 originated loans in each of the prior two years. In August 2017, the Bureau issued the 2017 HMDA Final Rule, which made technical corrections to, and clarified certain requirements adopted by, the 2015 HMDA Final Rule. Home Mortgage Disclosure (Regulation C); 82 FR 43088 (Sept. 13, 2017). Additionally, the Bureau issued final rules in 2019 and 2020 (2019 and 2020 HMDA Final Rules, respectively) that amended certain aspects of Regulation C after most of the 2015 HMDA Final Rule took effect.[9]. As mentioned previously, the Bureau recognizes that it faces challenges in its assessment, as it may be difficult to quantify benefits, and there may be limitations in the data available to the Bureau to evaluate the HMDA Rule's contributions to public investment and anti-discrimination monitoring and enforcement. In addition, once the Bureau's headquarters reopens, comments will be available for public inspection and copying at 1700 G Street NW, Washington, DC 20552, on official business days between the hours of 10 a.m. and 5 p.m. Eastern Time. discrimination in various ways. HMDA requires many, but not all, lenders to collect and report information . The assessment must address, among other relevant factors, the rule or order's effectiveness in meeting the purposes and objectives of title X of the Dodd-Frank Act and the specific goals stated by the Bureau. More detailed comments/information that are supported by data/analysis will generally be more useful to inform the assessment. Predatory Lending Laws: What You Need to Know. A triggering term is a word or phrase that requires the presentation of the terms of a credit agreement when used in advertising literature. Prepayment Penalty Term, Reasons for Denial Examples of statistics released include the average loan amounts, number of home mortgages approved, number of pre-approvals made, and the purpose of the individual mortgage loans. the private sector to areas where they are needed. The Home Mortgage Disclosure Act (HMDA) is a federal law approved in 1975 that requires mortgage lenders to keep records of key pieces of information regarding their lending practices, which they. reasons for charging a higher rate that may exhibit discriminatory The HMDA Rule amended the Board's pre-existing institutional coverage criteria that determine which institutions meet the definition of financial institution and are required to report HMDA data. 2021-25330 Filed 11-19-21; 8:45 am]. and services, go to Multifamily Affordable Units If an institution originated at least 25 closed-end loans in both 2018 and 2019, then as of January 1, 2020 the institution would have to collect, record and report HMDA data for calendar year 2020. Under pre-existing Regulation C, closed-end home purchase loans and refinancings were required to be reported if they were dwelling-secured and closed-end home improvement loans were required to be reported whether or not they were dwelling-secured. the early 1990s has led to increasing investor scrutiny regarding Document page views are updated periodically throughout the day and are cumulative counts for this document. Director, Bureau of Consumer Financial Protection. 80 FR 66127, 66129 (Oct. 28, 2015). Impact of Partial Exemptions on HMDA Data Availability for Census Tracts, 2019. HMDA Rule. Prior to the 2015 HMDA Final Rule taking effect, in the 2017 HMDA Final Rule the Bureau increased temporarily the open-end coverage threshold from 100 to 500 open-end lines of credit for calendar years 2018 and 2019. Similarly, the EGRRCPA provides that 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. All submissions should include document title and docket number.