Removing Barriers Blog

House Members Send Letter to CFPB Requesting Higher Exemption Threshold for HMDA
Posted December 17, 2015 by CUNA Advocacy

This week, 19 members of the US House of Representatives sent a letter to CFPB director Richard Cordray, requesting that his agency provide analysis on the effects of applying higher exemption thresholds for HMDA reporting. The letter suggested that higher exemption thresholds would help alleviate the potential adverse impacts of the new final rule.

This HMDA rule, as finalized by the CFPB a few months ago, requires covered credit unions to submit 48 unique data fields on each mortgage loan they make, doubling what was required by the Dodd-Frank law. This is a significant new burden on credit unions, many of which use consumer lending platforms for their home equity loans, which are often not set up to collect and report HMDA data.

The letter also stressed the existing compliance burdens, and legal liabilities, emanating from the major previous mortgage rules finalized over the past few years. And while the CFPB did provide a small exemption for the new HMDA rule, it would only exempt about 34,000 mortgage loans which is a tiny fraction of the nearly 10 million annual mortgage applications reported through HMDA. The letter expressed the members’ belief that more significant regulatory relief is possible through higher exemption thresholds, without compromising the scope and purpose of HMDA.

Finally, the letter requested that CFPB provide any analysis it may have done over the course of preparing the rule with regards to the impact of higher loan exemption thresholds, specifically thresholds of 100, 150, 250, and 500 loans.