On June 14, 2021, the CFPB issued a report that reviews differences in lending patterns for lenders below and above the 100-loan closed-end threshold set by the 2020 Home Mortgage Disclosure Act rule. The CFPB also issued a blog post that explains the data source and analytical approach, as well as key findings from their report. Even though the information presented in the report covers all 2019 HMDA reporters with closed-end origination volume below 1,000, the CFPB explains that their report highlights the contrasts between the reporters whose origination volume was below 100 and those whose origination volume was over 100, as 100 corresponds to the closed-end reporting threshold set by the 2020 HMDA Rule.
From the CFPB’s release:
“While this analysis is necessarily limited and preliminary, the report does find some differences in lending patterns for lenders above and below the threshold. Lenders below the 100-loan threshold appear to make more investment purpose loans to higher income borrowers and non-natural person borrowers (i.e., trusts, partnerships, and corporations), as well as more loans secured by properties in low-to-moderate income census tracts. These findings are consistent with a possible explanation that lenders below the 2020 rule’s 100-loan closed-end threshold are making more loans to investors buying up property in low-to-moderate income census tracts for rental or resale.”
The CFPB Blog/Release can be found here.