Politics & MoneyMortgage

CFPB modifies HMDA data disclosure, issues 2019 guidance

Bureau announces changes to how it will disclose loan-level data

The Consumer Financial Protection Bureau announced it has issued new guidance on Regulation C of the Home Mortgage Disclosure Act in an effort to protect consumers’ privacy.

The recently announced policy guidance affects loan-level data that is publicly disclosed beginning in 2019, according to the bureau's final rule (read here). The CFPB stated in its ruling that it intends to make these modifications to the data that financial institutions collected in 2018 when it is disclosed in 2019.

The CFPB's announcement on Regulation C outlines its final policy guidance that includes data modifications to protect consumers’ privacy, including excluding certain data from publicly disclosed HMDA data, such as the property address and applicant’s credit score.

The bureau also announced it intends to disclose certain information with less precision and presenting the data as a range instead, by disclosing ranges rather than specific values for an applicant’s age, the amount of the loan, and the number of units in the dwelling. 

The CFPB announced in its final rule that it is modifying its proposed policy guidance to change the proposed treatment of the following data fields:

 (1) the ratio of the applicant’s or borrower’s total monthly debt to the total monthly income relied on in making the credit decision;

(2) the number of individual dwelling units related to the property securing the covered loan or, in the case of an application, proposed to secure the covered loan; and

(3) the number of individual dwelling units related to the property securing the covered loan or, in the case of an application, proposed to secure the covered loan, that are income-restricted pursuant to Federal, State, or local affordable housing programs.

The CFPB said it intends to modify the public loan-level HMDA data to exclude the following:

  • The universal loan identifier or non-universal loan identifier
  • The date the application was received or the date shown on the application form
  • The date of action taken by the financial institution on a covered loan or application
  • The address of the property securing the covered loan or, in the case of an application, proposed to secure the covered loan
  • The credit score or scores relied on in making the credit decision
  • The unique identifier assigned by the Nationwide Mortgage Licensing System and Registry for the mortgage loan originator, and
  • The result generated by the automated underwriting system used by the financial institution to evaluate the application.

Additionally, the bureau said it intends to exclude free-form text fields used to report the following data:

  • Applicant or borrower race
  • Applicant or borrower ethnicity
  • The name and version of the credit scoring model used
  • The principal reason or reasons the financial institution denied the application, if applicable
  • The automated underwriting system name

In a statement, the CFPB said it has decided “it would be beneficial to conduct a separate notice-and-comment rulemaking to incorporate any modifications of HMDA data into the text of Regulation C,” and stated that the rulemaking will enable it to consider what HMDA data will be disclosed in future years following a feedback and comment period. The bureau stated it intends to commence that rulemaking in the new year.    

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