On May 2, 2019, the Consumer Financial Protection Bureau (CFPB) issued a Notice of Proposed Rulemaking (NPRM) relating to Home Mortgage Disclosure Act (HMDA) coverage thresholds and partial exemptions. It proposes to raise the coverage thresholds for collecting and reporting data about closed-end mortgage loans and open-end lines of credit under the rules of HMDA.
The October 2015 Final Rule (2015 HMDA Rule) established institutional and transaction coverage thresholds in Regulation C. The threshold for closed-end loans was set at 25 loans in each of the two preceding calendar years, and the open-end threshold at 100 open-end lines of credit in each of the two preceding calendar years. In 2017, the open-end threshold was temporarily increased to 500 open-end lines of credit for two years (calendar years 2018 and 2019).
The NPRM is proposing two alternatives to amend Regulation C to increase the threshold for reporting data about closed-end mortgage loans to either 50 or 100 closed-end mortgage loans. Additionally, the proposed rule would adjust the threshold for reporting data about open-end lines of credit by extending to January 1, 2022, the current temporary threshold of 500 open-end lines of credit and setting the threshold at 200 open-end lines of credit at the expiration of the proposed extension of the temporary threshold.
The proposed rule also provides partial exemptions from HMDA’s requirements added by the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA). The proposed rule incorporates interpretations and procedures of the 2018 HMDA Rule into Regulation C by adding §1003.3(d) and making various amendments to §1003.4. The NPRM also addresses additional interpretive issues that the 2018 HMDA Rule did not specifically address, such as how to determine whether a partial exemption applies to a transaction after a merger or acquisition. These proposed amendments would take effect on January 1, 2020.
The CFPB stated in an announcement that, “the NPRM would provide relief to smaller lenders from HMDA’s data reporting requirements and would clarify partial exemptions from certain HMDA requirements that Congress added in the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA).”
The CFPB also issued an Advance Notice of Proposed Rulemaking (ANPR) to solicit comments relating to whether to make changes to the data points that the 2015 HMDA Rule added to Regulation C or revised to require additional information.
Please direct any questions or comments to compliance@docmagic.com.
