The Consumer Financial Protection Bureau is amending Regulation C under the Home Mortgage Disclosure Act (“HMDA”), extending the current temporary threshold for collecting and reporting data about open-end lines of credit until January 1, 2022. The rule also incorporates partial exemptions from the Economic Growth, Regulatory Relief, and Consumer Protection Act (“EGRRCPA”), which Congress enacted in 2018.
The HMDA requires individual depository institutions and for-profit businesses to report data about originations and purchases of mortgage loans, as well as mortgage loan applications that are denied or withdrawn. The purpose is to provide the public with information that will assist borrowers in determining which financial institutions are serving housing needs in their community, assist public officials in distributing public-sector investment information to attract private investors, and identify possible discriminatory lending practices.
For institutions that issue open-end lines of credit, the new rule will extend the temporary coverage threshold of 500 open-end lines of credit. Financial institutions that originated fewer than 500 open-end lines of credit in either of the two preceding calendar years do not need to collect and report data concerning their open-end lines of credit.
The final rule implements the requirements for the partial exemption added by the EGRRCPA in August 2018, and not previously addressed in the August 2018 interpretive and procedural rule, by lessening the burden for smaller lenders. It clarifies that (i) insured depository institutions and insured credit unions covered by a partial exemption have the option of reporting exempt data fields; (ii) explains that only loans and lines of credit that are reportable count toward the threshold for the partial exemption; (iii) provides that specific data points in Regulation C are covered by partial exemptions; (iv) designates a non-universal loan identifier for partially exempt transactions for institutions that choose not to report a universal loan identifier; and (v) explains the exception to the partial exemptions for insured depository institutions with less than satisfactory examination histories under the Community Reinvestment Act of 1977.
The CFPB intends to issue a separate final rule in 2020 raising the permanent coverage thresholds for closed-end mortgage loans and open-end lines of credit.