On October 15, 2015 the Consumer Financial Protection Bureau (CFPB) published revised Regulation C rules, which implement the Home Mortgage Disclosure Act. The revisions are effective for the most part on January 1, 2018, certain provisions are phased in through January 1, 2020.
The revisions impact:
Coverage – Coverage rules are slightly revised, but do not qualify as a major item on anyone’s list. The CFPB is playing this as meaningful reduction of regulatory burden. It is not.
Covered Transactions – The CFPB has significantly expanded the types of transactions subject to Regulation C. The final rule adopts a dwelling-secured standard for all loans or lines of credit that are for personal, family, or household purposes.
- Most consumer-purpose transactions, including closed-end home-equity loans, home-equity lines of credit, and reverse mortgages, are subject to the regulation.
- Most commercial-purpose transactions (e., loans or lines of credit not for personal, family, or household purposes) are subject to the regulation only if they are for the purpose of home purchase, home improvement, or refinancing.
- The final rule excludes from coverage home improvement loans that are not secured by a dwelling (e., home improvement loans that are unsecured or that are secured by some other type of collateral) and all agricultural-purpose loans and lines of credit.
Reportable Data – The reportable categories have been significantly expanded. A few fields listed in the proposed rule did not make it to the final rule. We suspect those fields were “throwaways,” preplanned items the CFPB could drop in an effort to appear reasonable.
- Reportable fields have doubled to 52 fields.
- Ethnicity categories have been expanded to include subcategories. Hispanic or Latino subcategories include Mexican, Puerto Rican, Cuban, Other Hispanic or Latino. Asian subcategories include Asian Indian, Chinese, Filipino, Japanese, Korean, Vietnamese, Other Asian or of a particular Native Hawaiian or Other Pacific Islander subcategory (Native Hawaiian, Guamanian or Chamorro, Samoan, Other Pacific Islander) or of a particular American Indian or Alaska Native enrolled or principal tribe.
A copy of the 797 page final rule is available here.
Helpful HMDA information is available here.