CFPB Expanding Mortgage Data Reporting
The Consumer Financial Protection Bureau is considering requiring mortgage lenders to provide even more data about their housing finance loans and borrowers.
In remarks prepared for a Feb. 7 press call, CFBP Director Richard Cordray said Congress mandated increasing the information lenders must report to comply with the Home Mortgage Disclosure Act in the Dodd-Frank Financial Reform Act.
But, he added the agency was considering asking for more underwriting and pricing information not required by Dodd-Frank.
Currently, mortgage lenders have to report information such as the type of housing loan made, the census tract where the property is located and the borrower's race and ethnicity.
Dodd-Frank mandates require the bureau to contemplate regulations that will compel lenders to report things like the loan's total points and fees, term, the length of time any teaser rates apply, the borrowers age and borrower’s credit score.
In addition to the legislatively mandated additions, Cordray said the CFPB is considering requiring lenders to supply other information.
“We are considering asking financial institutions to include more underwriting and pricing information, such as an applicant’s debt-to-income ratio, the interest rate, the total origination charges, and the total discount points of the loan,” Cordray wrote in his prepared remarks.
“This will help regulators spot troublesome trends in mortgage markets around the country,” he added.
Cordray also reported the agency is working on ways it says it might be able streamline data reporting, in particular by using existing reporting platforms where ever possible.
“Approximately 70% of all loans eventually sold to the GSEs use the Uniform Loan Delivery Dataset of the Mortgage Industry Standards Maintenance Organization data standards for residential mortgages,” Cordray wrote. “Where possible, alignment of the HMDA data requirements to this open and free standard already being used by most lenders provides an opportunity to improve market efficiency, market understanding, and market oversight.”
CFPB is also considering leveling the playing field, Cordray wrote, about which lenders have to report.
Currently, many financial institution lenders have to report whether they make any loans each year, while non-financial institution lenders only have to report if they make more than 100 loans. The agency is considering making the standards uniform so that both financial institution lenders and non-financial institution lenders will have to report if they make more than 25 loans per year.
Cordray said the agency is only at the beginning of the rule making process for the new regulations and is convening a Small Business Review Panel to kick it off.
“We do this both to follow the law but also to listen to community banks, credit unions, and other small entities that may be affected by our rules,” Cordray wrote. “We also will engage with other stakeholders about what we are considering proposing. We will be seeking feedback from industry and consumer groups that will be affected by these changes to the HMDA process. Sometime later this year, we will put out a proposed rule seeking broader public feedback through the standard notice-and-comment rulemaking process.”