In 1980, the Federal Financial Institutions Examination Council (FFIEC) was tasked with the role of facilitating public access to mortgage information based on the HMDA act. In April 2020, the CFPB issued a final rule raising the data-reporting thresholds for collecting and reporting data about closed-end mortgage loans under the HMDA from 25 to 100 loans effective July 1, 2020. discriminatory lending patterns and enforcing antidiscrimination Manufactured Home Secured Property Type https://www.consumerfinance.gov/data-research/research-reports/a-brief-note-on-general-lending-patterns-small-to-medium-size-closed-end-hmda-reporters/. In conducting the assessment, the Bureau will evaluate the association between the requirements of the HMDA Rule and the HMDA Rule's stated purposes, goals, and objectives. Only official editions of the In the 2015 HMDA Final Rule, the Bureau explored whether covered entities passed through increased compliance costs to consumers and found the impact to be negligible. CRA (Three important things to remember): 1) CRA encourages financial institutions to meet the credit needs of its entire community, including low- and moderate- income neighborhoods, consistent w/ safe and sound banking operations. First, the HMDA Rule requires some financial institutions to report data on their open-end lines of credit. 1. [7] reasons for charging a higher rate that may exhibit discriminatory corresponding official PDF file on govinfo.gov. Mortgage lenders are required to keep records relating to loan applications, such as the type of loan, gender of applicants, race, the income of the borrower, status of loan application (whether approved or denied), etc. 50. 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. 80 FR 66128 (Oct. 28, 2015). Regulation C implements HMDA, 12 U.S.C. The Home Mortgage Disclosure Act (HMDA) Modified Loan Application Register (LAR) data for 2021 are now available on the Federal Financial Institutions Examination Council's HMDA Platform for approximately 4,316 HMDA filers. The institution is a depository financial institution covered by Regulation C Is the institution a for-profit mortgage-lending institution (other than a bank, savings association, or credit union)? Regulation C requires you to collect HMDA data associated with mortgage loan applications processed during 2021 if: Your credit union's total assets as of December 31, 2020, exceeded $48 million; 2. Financial institutions that meet only the closed-end coverage threshold are not required to report data on their open-end lines of credit, and financial institutions that meet only the open-end coverage threshold are not required to report data on their closed-end mortgage loans.[21]. place electronically. 85 FR 28364 (May 12, 2020). The CFPB also requested comment on a closed-end loan threshold of 100 originated loans in each of the prior two years. Property Address eCFR :: 12 CFR 1003.5 -- Disclosure and reporting. The Bureau also recognizes that, across stakeholders, there is interest and disagreement over certain aspects of the HMDA Rule, including thresholds. PDF A GUIDE TO HMDA Reporting - Federal Financial Institutions Examination Regulation C is a regulation that orders depository institutions to annually disclose loan data about the communities they serve. Ethnicity Comments relating to the usability of the public HMDA data, potential challenges of the current format of the public HMDA data, and recommendations for additional reporting by the Bureau that would be helpful in informing the use of the public HMDA data by communities, public officials, or other stakeholders; and. Legal Entity Identifier. For example, a loan officer may query applicants to see if <9y.xA^5*E2k%[sO=#!oO'0ZuwwPC]u5Y, applications by certain races (e.g. However, newly excluded institutions may opt to report data for 2020, but to do so they must report data for the entire year. A 1022(b)(2) cost-benefit analysis in the 2015 HMDA Final Rule estimated that the bulk of the costs associated with the rule derived from one-time implementation and not ongoing annual costs. Disclosure of Loan-Level HMDA Data, 84 FR 649 (Jan. 31, 2019). [39] It is not an official legal edition of the Federal The Bureau has revised the institutional and transactional coverage thresholds that determine whether financial institutions are required to collect, record, and report any HMDA data on closed-end mortgage loans or open-end lines of credit in recent years. see also defined by the Office of Management and Budget. An institution is required to comply with Regulation C only if it is a "financial institution" as that term is defined in Regulation C. The definition of financial institution includes both depository financial institutions and nondepository financial institutions, as those terms are separately defined in Regulation C. 12 CFR 1003.2(g). 19. The HMDA law also served as an important tool for public officers to track public investments in areas where they are required. 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). to the Federal Financial Institutions Examination Council (FFIEC), an The Bureau of Consumer Financial Protection (Bureau) is conducting an assessment of the 2015 Home Mortgage Disclosure Act (HMDA) Rule and related amendments in accordance with section 1022(d) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act). grown increasingly rare vis-a-vis the other forms outlined below. Hispanics) or genders (typically women) then there is reason 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. limited conditions allowed that are not related to financial condition or creditworthiness. 82 FR 43088 (Sept. 13, 2017); 84 FR 57946 (Oct. 29, 2019). The goal is to create greater transparency and to protect borrowers in the residential mortgage market. This repetition of headings to form internal navigation links few banks are found to be in violation of redlining clauses, as many [18], In April 2020, the Bureau issued the 2020 HMDA Final Rule, which increased the closed-end coverage threshold effective July 1, 2020, and the permanent level of the open-end coverage threshold effective January 1, 2022, upon the expiration of the temporary threshold.[19]. The Bureau interpreted these changes to require that public HMDA data be modified when the release of the unmodified data creates risks to applicant and borrower privacy interests that are not justified by the benefits of such release to the public in light of HMDA's statutory purposes. Lender Credits Learn more here. had contributed to the decline of some geographic areas by their failure Although these exemptions minimally affected data availability, regulators still need to verify whether lenders are eligible to use them. Home Mortgage Disclosure Act (Hmda) 0000003635 00000 n Federal eRulemaking Portal: https://www.regulations.gov. An institution is required to comply with Regulation C only if it is a "financial institution" as that term is defined in Regulation C. The definition of financial institution includes both depository financial institutions and nondepository financial institutions, as those terms are separately defined in Regulation C. 12 CFR 1003.2(g). Previous Years 2022 Guide to HMDA Reporting 2021 Guide to HMDA . ( iii) When the last day for submission of data prescribed under this paragraph (a) (1) falls on a Saturday or Sunday, a . 12 CFR 1003.1. The Bureau also considered in the 2015 HMDA Final Rule whether the new reporting requirements would cause smaller institutions to exit the mortgage market, either for closed-end mortgage loans or for open-end lines of credit. 0000001948 00000 n The Bureau also invites comments on additional data or analyses that would be helpful for the Bureau to evaluate the effects of different institutional coverage and loan-volume thresholds. wary of entering such relationships, insofar as they expose the discrimination in various ways. Community Reinvestment Act. Beginning with HMDA data collected in 2017, financial institutions were no longer required to provide their modified loan/application registers and disclosure statements directly to the public. At that time, you can make an appointment to inspect the documents by telephoning 202-435-7275. On October 9, 2020, the Bureau corrected several clerical errors in the Supplementary Information to the 2020 HMDA Final Rule, regarding the estimated cost savings in annual ongoing costs from various possible closed-end coverage thresholds. for Home Mortgage Disclosure Act-related data collected in 2020 and reported in 2021. Home Mortgage Disclosure Act Data Collection Requirements for Register (ACFR) issues a regulation granting it official legal status. denials based on a protected category). the Federal Register. This compensation may impact how and where listings appear. Financial Institutions Reform, Recovery, and Enforcement Act of 1989, Public Law 101-73, section 1211 (Fair lending oversight and enforcement section), 103 stat. + Is There a Gender Gap in Home Equity Loans? lender to the liability associated with the discriminatory behavior 0000008747 00000 n 54 FR 51356, 51357 (Dec. 15, 1989), Definition, Statistics, and Impact, Racial Bias in Medical Care Decision-Making Tools, Discrimination in Insurance Underwriting Guidelines, The Insurance Industry Confronts Its Own Racism, What Is Redlining? Regulation C is also an important component of the Act. 9. PDF GUIDE TO HMDA Reporting - Federal Financial Institutions Examination All comments, including attachments and other supporting materials, will become part of the public record and subject to public disclosure. Metropolitan Statistical Area (MSA) or other geographic area as to provide adequate home financing to qualified applicants on reasonable [11] The Bureau does not, however, expect that it will respond in the assessment report to each comment received pursuant to this document. (e.g. 84 FR 649 (Jan. 31, 2019). More detailed comments/information that are supported by data/analysis will generally be more useful to inform the assessment. The 2018 HMDA Rule and the 2019 HMDA Final Rule specify that the following data points do not need to be collected and reported if a transaction qualifies for a partial exemption under the EGRRCPA: ULI; property address; rate spread; credit score; reasons for These new data also help facilitate research about lending patterns, community credit needs, and financial market stability, according to researchers and advocacy organizations. Home Mortgage Disclosure Act HMDA Regulation C Flashcards PDF Four Pillars of an Eective HMDA Compliance Program The CFPB also issued an executive summary of the final rule, an unofficial redline of the changes to Regulation C, and other helpful materials. [44] The Bureau's 2015 HMDA Final Rule presented a basic framework of analyzing compliance costs for HMDA reporting, including ongoing costs and one-time costs for financial institutions. As previously reported, in May 2019 the CFPB proposed to increase the closed-end loan threshold from 25 to 50 originated loans in each of the prior two years, and to increase the permanent open-end line of credit threshold from 100 to 200 lines in each of the prior two years, as well as extend the 500 originated lines temporary threshold through 2021. and (4) operational and compliance costs. II, 110 stat. Regulation C requires financial institutions to report HMDA data. 105 0 obj <> endobj Occupancy Type applications by certain races (e.g. Although affected entities would incur additional one-time costs from the adjustment to new HMDA requirements, the Bureau estimated these would be negligible. Start Printed Page 66221 interagency body empowered to administer HMDA. Home Ownership and Equity Protection Act (HOEPA) Status the official SGML-based PDF version on govinfo.gov, those relying on it for Definition and Examples, Dodd-Frank Act: What It Does, Major Components, Criticisms, What Is Regulation Z (Truth in Lending)? 12 CFR 390.147. 11. HMDA Hints: What Purchasers of Mortgages Need to Know About their In light of these amendments, the Board subsequently recognized a third HMDA purpose of identifying possible discriminatory lending patterns and enforcing antidiscrimination statutes, which now appears with HMDA's other purposes in Regulation C.[46]. [24] Manufactured Home Land Property Interest 67 FR 7222 (Feb. 15, 2002); 67 FR 43218 (June 27, 2002). HMDA section 302(b), 12 U.S.C. The Bureau has determined that considering all of these rules together will facilitate a more meaningful assessment of the HMDA Rule. The assessment also must reflect available evidence and any data that the Bureau reasonably may collect. Timothy Li is a consultant, accountant, and finance manager with an MBA from USC and over 15 years of corporate finance experience. Email: [email protected]. It was viewed 47 times while on Public Inspection. Director, Bureau of Consumer Financial Protection. Created by MaxDO01 Terms in this set (7) There are certain HMDA data points that must be reported by all HMDA reporting institutions, even if the institution may take a partial exemption for some data points. 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. Congress believed that some financial institutions Accessed Aug. 8, 2021. Where there are probable cases of discrimination, the regulatory inquiry focuses on whether specific classes of borrowers were denied housing credit for reasons other than acceptable characteristics, such as inadequate collateral. 37. As a result, an institution that originated at least 25 closed-end mortgage loans or at least 100 open-end lines of credit in each of the two preceding calendar years, and met all of the other applicable criteria for institutional coverage, met the definition of financial institution and was required to report HMDA data. Regulation C is also an important component of the HMDA Act, and it was introduced by the Federal Reserve to ensure mortgage lenders comply with the new regulations. the prevailing rates at the time of the application), Lien status of the loan (1st or 2nd lien). to the courts under 44 U.S.C. The CFPB recently issued a final Home Mortgage Disclosure Act (HMDA) rule to increase the threshold to report closed-end mortgage loans from 25 to 100 originated loans in each of the prior two years, and to increase the permanent threshold to report dwelling-secured open-end lines of credit from 100 to 200 originated lines in each of the prior t. This rule also incorporated into Regulation C the interpretations and procedures from the 2018 HMDA Rule and implemented further the EGRRCPA. if the rate given to the borrower is above a certain threshold of 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. This was in response to comments from stakeholders that they wanted to review the 2018 HMDA data before submitting comments, and such data typically is released in the later part of summer. The law does not provide guidelines on the specific activities of lenders nor establish a quota system of mortgage loan allocation in any geographical area where mortgage lenders are located. The Bureau welcomes comments from stakeholders, in particular information and data that would produce a more robust evaluation of the costs and benefits of the HMDA Rule. As of July 1, 2020, if that institution originated fewer than 100 closed-end loans in either 2018 or 2019, it would no longer be a HMDA reporting institution (a newly excluded institution). 12 CFR 1003.4(a)(16), (18) through (21), (23) and (24), (29) and (30), (32), and (35) through (38). rate, then the mere application of this principal - which is 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. 0000008880 00000 n The new closed-end loan threshold is effective July 1, 2020. 3. 1296 (2018); Partial Exemptions from the Requirements of the Home Mortgage Disclosure Act Under the Economic Growth, Regulatory Relief, and Consumer Protection Act (Regulation C), 83 FR 45325 (Sept. 7, 2018). Specifically, the law requires lenders to maintain records of their lending practices.