WASHINGTON—The Consumer Financial Protection Bureau has issued a Request for Information (RFI) to seek input on rules implementing the Home Mortgage Disclosure Act (HMDA).
The CFPB, which has announced a more aggressive posture under its new director, said it plans to review recent changes to the rules and evaluate their effectiveness. This evaluation will “strengthen the CFPB’s ability to maintain a fair, competitive, and non-discriminatory mortgage market,” the Bureau said.
HMDA, which was enacted in 1975, requires many lenders to report information about the home loans for which they receive applications or that they originate or purchase as part of an effort by the government to identify possible discriminatory lending patterns. The CFPB maintains an online tool that provides access to the public loan data, allowing users to filter information, create summary tables, download the data, and save their results, the agency noted.
Changes to 2015 Rule
The CFPB finalized changes to the HMDA regulations in 2015, expanding the types of data reported by lenders to improve overall market information and help with monitoring for fair lending compliance. The 2015 rule also improved the reporting process by aligning requirements with industry data standards, significantly enhancing the technological interface, and easing requirements for some small banks and credit unions, the agency said.
The CFPB said it is now seeking comment from the public to ensure uses the data collected under the HMDA Rule to most effectively meet the rule’s goals, adding that it is seeking comments on its plans to assess the effectiveness of the HMDA Rule.
The Specifics
Specifically, the CFPB said it will focus on:
- Institutional coverage and transactional coverage
- Data points
- Benefits of the new data and disclosure requirements
- Operational and compliance costs
The RFI will remain open for 60 days after publication in the Federal Register.
The RFI follows an August 2021 HMDA report, which found that mortgage lenders more often deny credit and charge higher interest rates to Black and Hispanic applicants than they do to white applicants, and a July 2021 CFPB analysis of mortgage lending patterns within the Asian American Pacific Islander (AAPI) communities. According to the Bureau, the July 2021 CPFB analysis, using the expanded reporting of racial and ethnic data made possible by the 2015 HMDA rule, “found considerable heterogeneity among AAPI communities, with some subgroups showing mortgage denial rates similar to those of Black and Hispanic borrowers.”
The CFPB reported it also made use of the enhanced data in a May 2021 report studying the financing of manufactured housing loans.