CFPB Issues Statement on Partial HMDA Exemptions for Certain Depository Institutions

On July 5, 2018, the CFPB issued a statement regarding the implementation of certain amendments to HMDA’s data collection and reporting requirements as a result of the Economic Growth, Regulatory Relief, and Consumer Protection Act (the Act).  The Act, which was signed into law on May 24, 2018, provides certain depository institutions with partial exemptions from some HMDA requirements.

In the statement, the CFPB notes that the partial exemptions are generally available to insured depository institutions and insured credit unions:

• For closed-end mortgage loans if the institution originated fewer than 500 closed-end mortgage loans in each of the two preceding calendar years; and
• For open-end lines of credit if the institution originated fewer than 500 open-end lines of credit in each of the two preceding calendar years.

For transactions subject to the partial exemptions, the Act provides an exemption from the collection, recording, and reporting requirements for some, but not all, of the data points specified in HMDA’s Regulation C.  For example, although the partial exemption will generally cover a number of enumerated data points such as rate spread, loan term, and credit score, covered institutions will still be required to report certain other information such as the borrower’s income, race, ethnicity, sex, and age.

The statement also clarifies that the Act will not affect the format of the Loan/Application Registers (LARs) for institutions filing HMDA data collected in 2018, although certain updates are anticipated to the 2018 Filing Instructions Guide (FIG) to allow exemption codes to be entered for the impacted fields.  The CFPB said it expects to provide further guidance on the applicability of the Act to HMDA data collected in 2018 later this summer.

It is important to note that the above partial exemptions only apply to certain depository institutions and are not applicable to nondepository financial institutions that are subject to HMDA.

The CFPB’s statement is available here. The Economic Growth, Regulatory Relief and Consumer Protection Act is accessible here.