Summary: CFPB Notice of Proposed Policy Guidance/Request for Comments re: Disclosure of Loan-Level HMDA Data

Prepared by the NASCUS Legislative and Regulatory Affairs Department
October 2017

The Consumer Financial Protection Bureau (Bureau) is proposing policy guidance that would describe modifications that the Bureau intends to apply to the loan-level HMDA data that financial institutions will report under the Home Mortgage Disclosure Act (HMDA) before the data is disclosed to the public.  The policy guidance applied to HMDA data to be reported under Regulation C (implementing regulation) effective January 1, 2018.  The Bureau will make the data available to the public beginning in 2019. 

Comments are due by November 24, 2017.  The proposed policy guidance can be found here,

Summary:

The Home Mortgage Disclosure Act (HMDA) requires certain financial institutions to collect, report, and disclose data about their mortgage lending activity on an ongoing basis to both Federal regulators and the general public.  In October 2015, the Bureau published a final rule amending Regulation C (“2015 HMDA Final Rule”) to implement amendments required by Dodd-Frank.  The Bureau interpreted the revised HMDA regulation to require that is use a balancing test to determine whether and how HMDA data should be modified prior to its disclosure to the public in order to protect applicant/borrower privacy while also fulfilling HMDA’s public disclosure purposes. 

The proposed Policy Guidance describes the Bureau’s application of the balancing test to date and the loan-level HMDA data that it proposes to make available to the public beginning in 2019.  For example, the Bureau proposes to modify the public loan level HMDA data to exclude certain pieces of information such as the universal loan identifier; the date the application was received; the date action was taken by the financial institution on a covered loan or application; etc.  The Bureau also intends to exclude certain free-form text fields used to report information such as applicant/borrower race; applicant/borrower ethnicity; name and version of the credit scoring model used to generate each credit score(s) relied on in the credit decision; etc.

Additionally, the Bureau proposes to modify the public loan-level HMDA data to reduce the precision of most of the values reported for certain data fields such as the amount of the covered loan or amount applied for; age of the borrower; ratio of the applicant/borrower total monthly debt to total monthly income relied upon in the credit decision; etc.

Comments Requested:

The Bureau invites public comment on the proposed Policy Guidance.  However, the proposal is not intended to re-open any portion of the 2015 HMDA Final Rule.