On 5/2/19, the CFPB issued both a Notice of Proposed Rulemaking (NPRM) as well as an Advance Notice of Proposed Rulemaking (ANPR) regarding the Home Mortgage Disclosure Act (HMDA).
NPRM
Overall, the 275 page NPRM doesn’t provide much that we don’t know already. Most of the proposed rule is just the addition of the CFPB’s August 2018 Interpretive and Procedural rule implementing the partial exemption, as required by ERGGCPA. That said, the biggest change with the NPRM comes relates to proposed changes for the reporting threshold, both for closed-end and open-end loans.
For closed-end loans, the NPRM proposes to alternative options. Option 1 is to adjust the coverage threshold from 25 to 50 closed-end mortgage loans, while option 2 would increase the coverage threshold to 100 closed-end mortgage loans. As the NPRM provides vast amounts of data, it also explains a change in the coverage threshold from 25 to 50 would relieve 745 additional institutions from HMDA reporting, while a change to 100 would relieve 1,682 more institutions from HMDA reporting.
On the other hand, the NPRM is proposing to change the reporting threshold for open-end loans to 500 for two more years (as the current temporary threshold of 500 is set to expire on 1/1/2020), but then change to a permanent number of 200 in 2021. The NPRM explains that 401 institutions would benefit from the change to 200 (compared to the threshold of 100 that would otherwise take place on 1/1/2020), while only 280 institutions who currently don’t report open-end lines of credit under the 500 loan threshold will have to report under the 200 loan threshold.
The CFPB is soliciting comment on both the new rule which includes both the implementation of the partial exemption into Regulation C as well as changes in the applicable thresholds for both open-end and closed-end loans. The CFPB is also soliciting comments as to benefits and reasonings for higher thresholds than proposed.
The proposal plans to implement most changes on 1/1/2020, though the 200 threshold for open-end loans would go into effect on 1/1/2022.
Comments are due 30 days after publication in the Federal Register (which has not occurred as of the date of this article). The full NPRM can be found here.
ANPR
Much shorter than the NPRM, the 16 page Advance Notice of Proposed Rulemaking (ANPR) Relating to Home Mortgage Disclosure (Regulation C) Data Points and Coverage solicits comment on whether the CFPB should make changes to the data points from the October 2015 final rule that went into effect on 1/1/2018. The ANPR is also soliciting comments relating to the benefits and burdens associated with the reporting of business- or commercial-purpose transactions under Regulation C.
Comments are due 60 days after the date of publication in the Federal Register (which also has not occured as of the date of this article). The full ANPR can be found here.
