Magazine article American Banker

CFPB to Reopen Mortgage Disclosure Rule, Will Not Penalize Data Errors

Magazine article American Banker

CFPB to Reopen Mortgage Disclosure Rule, Will Not Penalize Data Errors

Article excerpt

Byline: Kate Berry

The Consumer Financial Protection Bureau said Thursday that it plans to reopen its rulemaking for the Home Mortgage Disclosure Act and will not assess penalties against mortgage lenders for any errors in data collected next year.

The announcement marked a big win for the mortgage industry, which has repeatedly asked for a so-called safe harbor from HMDA reporting errors and wanted a delay in the rule, which goes into effect on Jan. 1.

"The bureau does not intend to assess penalties with respect to errors in data collected in 2018 and reported in 2019," the CFPB said in a press release. "Collection and submission of the 2018 HMDA data will provide financial institutions an opportunity to identify any gaps in their implementation of amended Regulation C and make improvements in their HMDA compliance management systems for future years. Any examinations of 2018 HMDA data will be diagnostic to help institutions identify compliance weaknesses and will credit good faith compliance efforts."

The change is part of acting Director Mick Mulvaney's plan to reduce the burden of regulations on companies and to reconsider rules promulgated by former CFPB Director Richard Cordray.

Mortgage lenders have complained about the CFPB's sweeping changes made in 2015 to Regulation C, which implements HMDA. Some of the data is mandated by the Dodd Frank Act, but under Cordray the bureau added 25 new data points and modified 14 others, in addition to the existing 9 that were part of required reporting for years.

The mortgage industry now has cause to rejoice as Mulvaney considers scrapping what is not required by statute, such as loan underwriting and pricing information. …

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