CFPB Clarifies HMDA Reporting Thresholds for Community Banks and Credit Unions

On August 24, 2017, the Consumer Financial Protection Bureau (CFPB) issued a rule amending the 2015 updates to the Home Mortgage Disclosure Act (HMDA) rule. The CFPB has temporarily changed reporting requirements for banks and credit unions that issue home-equity lines of credit, and clarified the information that financial institutions are required to collect and report about their mortgage lending.

Reporting Threshold Under rules that are scheduled to take effect in January 2018, financial institutions would have been required under the Home Mortgage Disclosure Act to report home-equity lines of credit if they made 100 such loans in each of the last two years. The August 24th final rule has increased that threshold to 500 loans through calendar years 2018 and 2019 so that the CFPB can consider whether to make a permanent adjustment. This change was initially proposed in July 2017.

This temporary increase in the threshold will provide time for the CFPB to consider whether to initiate another rulemaking to address the appropriate level for the threshold for data collected beginning January 1, 2020.

Clarifications and Technical Corrections This final rule contains a number of clarifications, technical corrections, and minor changes to the HMDA regulation. These include clarifying certain key terms, such as “temporary financing” and “automated underwriting system.” The changes also establish transition rules for reporting certain loans purchased by financial institutions. Another change will facilitate reporting the census tract of a property, using a geocoding tool that will be provided on the CFPB’s website. These changes were initially proposed in April 2017.

View the final rule

The CFPB is also releasing on August 24, 2017 an executive summary of the final rule, updates to technical filing instructions, and other implementation materials. The CFPB hopes that these materials will help financial institutions understand and implement the changes adopted in the final rule.

View the regulatory implementation materials

View the technical instructions

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Marissa Blundell, JD, principal, services as CLA Bankers Advisory’s chief operating officer, overseeing all quality control and compliance assessment services. She is a graduate of Skidmore College and New England School of Law. She is admitted to the Massachusetts Bar. Marissa provides compliance training to clients, conducts public training webinars, and speaks at state and regional industry events. She is co-chair of the Massachusetts Mortgage Bankers Association Legislative Committee and is a member of the Mortgage Action Alliance Steering Committee and the national Mortgage Bankers Association’s Quality Assurance Committee.

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