Changes Proposed to Mortgage Data Reporting for Small Banks, CUs
08/04/17 – The Consumer Financial Protection Bureau (CFPB) has issued a proposal on reporting requirements for banks and credit unions that issue home-equity lines of credit.
The CFPB updated the Home Mortgage Disclosure Act (HMDA) regulations in 2015 in order to improve the quality and type of data reported by financial institutions. Most of the updated requirements take effect in January 2018. Under the original HMDA financial institutions were required to report home-equity lines of credit if they made 100 such loans in each of the last two years. The new proposal would increase that threshold to 500 loans through calendar years 2018 and 2019 while the CFPB considers whether to make the adjustments permanent.
One of the significant changes that will take effect in 2018 is a requirement for some lenders to collect, report, and disclose data on certain dwelling-secured open-end lines of credit, including home-equity lines of credit. With a home-equity line of credit, consumers can borrow money against the equity in their home over time, usually up to an established credit limit, using special checks or a credit card. As the principal is repaid, consumers can take out that amount again.
The CFPB sought comments on whether to postpone collection of this information for smaller-volume institutions so that the Bureau can study whether the threshold should be adjusted permanently. The comment period for this proposal is closed. The CFPB intends to issue another proposal on this issue and will seek comments during that time.