Bureau Says It Will Line up HMDA Exemptions with New Reg Relief Law

Mike Sorohan msorohan@mba.org

July 06, 2018

The Consumer Financial Protection Bureau yesterday issued a statement signaling its intent to align its Home Mortgage Disclosure Act policies with the recently passed Economic Growth, Regulatory Relief and Consumer Protection Act.

The statement notes the Act, signed into law this past May, provides partial exemptions for some insured depository institutions and insured credit unions from certain HMDA requirements. The partial exemptions are generally available to insured depository institutions and insured credit unions.

Those exemptions include:

--For closed-end mortgage loans if the institution originated fewer than 500 closed-end mortgage loans in each of the two preceding calendar years.

--For open-end lines of credit if the institution originated fewer than 500 open-end lines of credit in each of the two preceding calendar years.

--For closed-end mortgage loans or open-end lines of credit subject to the partial exemptions, the Act states that the "requirements of [HMDA section 304(b)(5) and (6)]" shall not apply.

"Accordingly, for these transactions, those institutions are exempt from the collection, recording and reporting requirements for some, but not all, of the data points specified in current Regulation C," the Bureau said.

The Bureau said it expects later this summer to provide further guidance on applicability of the Act to HMDA data collected in 2018.

Additionally, the Bureau said for all institutions filing HMDA data regarding 2018 Loan/Applications Registers, the Act will not affect the format of the LARs:

--LARs will be formatted according to the previously-released 2018 Filing Instructions Guide for HMDA Data Collected in 2018 (If an institution does not report information for a certain data field due to the Act's partial exemptions, the institution will enter an exemption code for the field specified in a revised 2018 FIG that the Bureau expects to release later this summer.

--All LARs will be submitted to the same HMDA Platform. A beta version of the HMDA Platform for submission of data collected in 2018 will be available later this year for filers to test.

The Bureau statement also reiterated as announced in December 2017, it does not intend to require data resubmission for HMDA data collected in 2018 and reported in 2019, unless data errors are material. Furthermore, the Bureau does not intend to assess penalties with respect to errors in data collected in 2018 and reported in 2019. Collection and submission of the 2018 HMDA data will provide financial institutions an opportunity to identify any gaps in their implementation of amended Regulation C and make improvements in their HMDA compliance management systems for future years. "Any examinations of 2018 HMDA data will be diagnostic to help institutions identify compliance weaknesses, and the Bureau will credit good-faith compliance efforts," the statement said.

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