During October 2015 the Consumer Financial Protection Bureau (CFPB) published final rules to amend Regulation C. The rules are effective, for the most part, on January 1, 2018. On April 13, 2017 the CFPB published substantially proposed revisions to the final rules. Again on July 14, 2017 the CFPB published additional changes to the final rules.
Today, with the clock racing to the January 1st mandatory compliance date the CFPB published final rules (225 pages) to complete the two proposals issued earlier this year. The revised final rule is effective, for the most part, on January 1, 2018.
Under the final rule financial institutions would have been required to report open-end lines of credit if they made 100 such loans in each of the last two years. The final rule has increased that threshold to 500 loans through calendar years 2018 and 2019 so that the Bureau can consider whether to make a permanent adjustment. This change was initially proposed in July 2017.
This temporary increase in the threshold will provide time for the Bureau to consider whether to initiate another rulemaking to address the appropriate level for the threshold for data collected beginning January 1, 2020.
Clarifications and Technical Corrections
The final rule also contains a number of clarifications, technical corrections, and minor changes to the HMDA regulation. These include clarifying certain key terms, such as “temporary financing” and “automated underwriting system.” The changes will also establish transition rules for reporting certain loans purchased by financial institutions. Another change will facilitate reporting the census tract of a property, using a geocoding tool that will be provided on the Bureau’s website. These changes were initially proposed in April 2017.
The Big Question
Will banks, software vendors, and other parties be able to digest the huge revisions, make changes to policies, procedures and systems in an organized fashion between now and January 1, 2018? The pressure is on.
Information about the July 14, 2017 proposed HMDA changes is available at: https://www.jackscomplianceresource.com/hmda-proposed-heloc-change/
Information about the April 13, 2017 Proposed HMDA Changes is available at https://www.jackscomplianceresource.com/proposed-changes-to-regulations-b-and-c/
A link to the August 24, 2017 Final Rule is available at: https://files.consumerfinance.gov/f/documents/201708_cfpb_final-rule_home-mortgage-disclosure_regulation-c.pdf