The NCUA to Host Share Insurance Webinar on April 13
Share insurance is fundamental to the credit union system, and it’s a complex topic. To help credit unions better understand share insurance, the National Credit Union Administration has scheduled a webinar for Thursday, April 13, to discuss how member accounts are covered.
Registration for this webinar is now open. The webinar is scheduled to begin at 2 p.m. Eastern and run approximately 60 minutes. It will be close captioned, and there is no charge. Participants will be able to log in and view the webinar on their computers or mobile devices using the registration link. They should allow pop-ups from this website.
NCUA staff from the Office of Credit Union Resources and Expansion will discuss topics including:
- Types of accounts covered by share insurance;
- What happens to share insurance coverage when credit unions merge;
- What happens to insurance of accounts if a member passes away; and
- General information about trusts.
NCUA Regulatory Alert (23-RA-02): Home Mortgage Disclosure Act Data Collection Requirements for Calendar Year 2023
If your credit union makes residential mortgage loans and meets all four criteria outlined below, you must comply with the Consumer Financial Protection Bureau’s (CFPB) Regulation C, which implements the Home Mortgage Disclosure Act (HMDA).
Regulation C requires you to collect HMDA data associated with mortgage loan applications processed during 2023 if:
- Your credit union’s total assets as of December 31, 2022, exceeded $54 million;
- Your credit union had a home or branch office in a Metropolitan Statistical Area on December 31, 2022;
- Your credit union originated at least one home purchase loan (other than temporary financing such as a construction loan) or refinanced a home purchase loan, secured by a first lien on a one-to-four-unit dwelling during 2022; and
- Your credit union originated at least 25 covered closed-end mortgage loans in each of the two preceding calendar years (2021 and 2022) or at least 200 covered open-end lines of credit in each of the two preceding calendar years (2021 and 2022).
If your credit union meets all four criteria, you must collect HMDA data during calendar year 2023 and submit the data to the CFPB no later than March 1, 2024.
CFPB & FHFA news release announcing the publication of updated loan-level data for public use collected through the National Survey of Mortgage Originations
The Consumer Financial Protection Bureau (CFPB) and the Federal Housing Finance Agency (FHFA) today published updated loan-level data for public use collected through the National Survey of Mortgage Originations (NSMO). The data also provide updated mortgage performance and credit information for a nationally representative sample of mortgage borrowers from 2013 to 2020.
Key highlights from the updated data are:
- The COVID-19 pandemic shaped the mortgage borrower experience in 2020. A higher share of borrowers reported that a paperless online mortgage process was important to them in 2020 (48 percent) than in 2019 (42 percent). More borrowers reported that the mortgage closing did not occur as originally scheduled in 2020 (21 percent) than in 2019 (17 percent).
- Mortgage borrowers, particularly those refinancing a loan, responded to the low-interest rates in 2020. The share of borrowers who rated themselves very familiar with available interest rates increased from 55 percent in 2019 to 69 percent in 2020. The share who reported being very satisfied that they got the lowest interest rate for which they could qualify increased from 67 percent in 2019 to 75 percent in 2020.
- Borrowers who refinanced in 2020 were more well off financially than those who refinanced in 2019:
- A higher share reported their household income was $175,000 or higher in 2020 (29 percent) than in 2019 (20 percent).
- Similarly, a higher share indicated that they owned stocks, bonds, or mutual funds in 2020 (53 percent) than in 2019 (43 percent).
- Relatedly, 76 percent of borrowers who refinanced were not at all concerned about qualifying for a mortgage in 2020, up from 66 percent in 2019.
Watch The Consumer Financial Protection Bureau’s Semi-Annual Report to Congress
December 15, 2022
CFPB Amendment to the HMDA Rule
Home Mortgage Disclosure (Regulation C); Judicial Vacatur of Coverage Threshold for Closed-End Mortgage Loans
In April 2020, the Consumer Financial Protection Bureau issued a final rule (2020 HMDA Rule) to amend Regulation C to increase the threshold for reporting data about closed-end mortgage loans. The 2020 HMDA Rule increased the closed-end mortgage loan reporting threshold from 25 loans to 100 loans in each of the two preceding calendar years, effective July 1, 2020.
On September 23, 2022, the United States District Court for the District of Columbia vacated the 2020 HMDA Rule as to the increased loan-volume reporting threshold for closed-end mortgage loans. As a result of the September 23, 2022 order, the threshold for reporting data about closed-end mortgage loans is 25, the threshold established by the 2015 HMDA Rule. Accordingly, this technical amendment updates the Code of Federal Regulations to reflect the closed-end mortgage loan reporting threshold of 25 mortgage loans in each of the two preceding calendar years.
You can access technical amendment here: www.consumerfinance.gov/rules-policy/final-rules/hmda-reg-c-judicial-vacatur-of-coverage-threshold-for-closed-end-mortgage-loans/.
The CFPB is proposing:
- Covered nonbanks would report certain agency and court orders connected to consumer financial products and services: Generally, nonbanks would have to report final agency and court orders and judgments, including consent and stipulated orders, brought under federal consumer financial protection laws or state laws regarding unfair, deceptive, or abusive acts or practices.
- Larger supervised nonbanks would designate a senior executive to attest regarding the firm’s compliance with covered orders: Larger nonbanks that are supervised by the CFPB would be required to designate a senior executive to submit an annual supervisory written statement attesting to the steps taken to oversee the activities subject to the order and whether the executive knows of any violations of, or other instances of noncompliance with, the covered order.
Prepared Statement of Director Rohit Chopra before the House Committee on Financial Services
The CFPB’s market monitoring and supervision of financial institutions provides one lens into the state of the economy. Consumer demand has rebounded as our country transitions out of pandemic conditions. While the labor market remains strong, household debt has increased rapidly. The rise in household payment burdens from auto loans and credit cards has been particularly pronounced, given rising interest rates, the cost of vehicles, and the impact of inflation on other goods and services in the economy.
As consumers continue to navigate the economic impacts and ripple effects of the pandemic, their financial patterns have adapted and responded to changing conditions – as have the companies that serve them. For example, the CFPB has observed a notable increase in use of Buy Now, Pay Later products over the past few years. As interest rates on credit cards increase – and correspondingly, outstanding balances – a low- or no-interest Buy Now, Pay Later product that spreads the cost of goods over four payments can be particularly appealing. The CFPB’s recent study on Buy Now, Pay Later noted a significant increase in use of these products to fund essential goods and services. The CFPB is working to ensure that Buy Now, Pay Later lenders adhere to the same protocols and protections as other similar financial products to avoid regulatory arbitrage and to ensure a consistent level of consumer protection.
(Feb. 4, 2022) A reminder that federally insured credit unions must comply with rules governing disclosure in mortgage loans, particularly those meeting four criteria, is outlined by NCUA in a “regulatory alert” issued this week.
In its regulatory alert 22-RA-01 (Home Mortgage Disclosure Act Data Collection Requirements for Calendar Year 2022), NCUA said credit unions making the home loans, and meeting the four criteria, must comply with the CFPB’s Regulation C, which implements the Home Mortgage Disclosure Act (HMDA).
The agency stated that the rule requires credit unions (and other financial institutions) to collect HMDA data associated with mortgage loan applications processed during 2022 if the credit union:
- Has total assets of more than $50 million as of Dec. 31, 2021;
- Had a home or branch office in a Metropolitan Statistical Area on Dec. 31, 2021;
- Created at least one home purchase loan (other than temporary financing such as a construction loan) or refinanced a home purchase loan, secured by a first lien on a one-to-four unit dwelling during 2021; and
- Originated at least 100 covered closed-end mortgage loans in each of the two preceding calendar years (2020 and 2021) or at least 200 covered open-end lines of credit in each of the two preceding calendar years (2020 and 2021).
LINK:
(Nov. 24, 2021) Covering everything from the 2015 rule through last year’s revisions, a voluntary assessment of the CFPB’s Home Mortgage Disclosure Act (HMDA) rule is underway, according to the Federal Registernotice published this week by the bureau.
Public comment is being taken on the effort until Jan. 21, according to the notice.
Under the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank), the bureau is required to assess any significant rule or order and report on it within five years of its effective date. Public comment on recommendations must also be invited for modifying, expanding, or eliminating the rule or order before publishing a report on the assessment.
CFPB said the assessment is voluntary since the bureau determined that the HMDA rule does not meet the definition of a “significant” rule for purposes of the Dodd-Frank Act, but the bureau will conduct the review in accordance with the statute’s provisions for required assessments.
That said, it noted that this assessment will address the 2015 HMDA final rule and the subsequent HMDA rules issued in 2017, 2018, 2019, and 2020. Given the difficulty in isolating the different effects of the 2015 rule and subsequent rules, the bureau said it has decided that considering all of them together “will facilitate a more meaningful assessment” of the rule.
To assess the effectiveness of the HMDA rule, CFPB said it intends to evaluate: Institutional coverage and transactional coverage; data points; benefits of the new data and disclosure requirements; and operational and compliance costs. The bureau said it is incorporating into the assessment all rules that implicate calendar-year HMDA data beginning with data collected in 2018 through data collected in 2021.
LINK:
Federal Register notice: Request for Information Regarding the HMDA Rule Assessment
(Oct. 29, 2021) Credit unions, banks and other lenders should use census tract information provided in the 2020 Census for mortgage-related data collected beginning next year, CFPB said this week. In a “HMDA Reminder,” the bureau noted that Regulation C (which implements the Home Mortgage Disclosure Act, or HMDA) requires financial institutions to provide census tract information for certain purposes.
“To determine what to report for this data point, a covered financial institution must look to the ‘most recent decennial census conducted by the U.S. Census Bureau’ and ‘use the boundaries and codes in effect on Jan. 1 of the calendar year covered by the loan/application register that it is reporting,’” the bureau said.
Census tract data provided by the 2020 census must be applied to data collected beginning Jan. 1, 2022, the bureau added.
Additionally, according to the agency, the FFIEC’s “Geocoder” will use census tract information from the 2020 census also beginning with the new year. (Geocoder is a web-based tool designed to help financial institutions meet the legal requirement to report information on mortgage, business, and farm loans.)
LINK:
(Sept. 17, 2021) An updated “filing instructions guide” (FIG), as well as an updated supplemental guide for quarterly filers, for reporting Home Mortgage Disclosure Act (HMDA) data for 2022 has been posted by the FFIEC, the group said late last week.
According to the FFIEC, the updated FIG and supplemental guide will help institutions file annual HMDA data collected in 2022 with the Consumer Financial Protection Bureau (CFPB) in 2023.
The exam council said there are no significant changes to the submission process for data collected in 2022 and reported in 2023.
LINK:
Filing instructions guide for HMDA data collected in 2022
(June 18, 2021) 2020 mortgage lending transactions at 4,475 U.S. financial institutions reported under HMDA are now available, the FFIEC said Thursday. Covered institutions include credit unions, banks, savings associations and mortgage companies … The reserve ratio for the insurance fund of bank deposits dropped to 1.25% in the first quarter, the FDIC Board was told this week. However, the board decided to stay the course on its “fund restoration plan” to bring the Deposit Insurance Fund (DIF) back up to a ratio of 1.35% over the next eight years. Along that line: the board decided not to make any changes to bank assessment rates (at least for now).
LINKS:
FFIEC Announces Availability of 2020 Data on Mortgage Lending
FDIC restoration plan semiannual update
(May 28, 2021) Consumers borrowing to buy manufactured homes face higher interest rates, and ultimately barriers to credit through limited refinancing options, CFPB contends in a report released Thursday, which it said is based on new information collected beginning in 2018 under the Home Mortgage Disclosure Act (HMDA).
The bureau claimed that manufactured housing is “one of the one of the most affordable types of housing available to low-income consumers” and makes up 13% of the housing stock in small towns and rural areas. However, the bureau said, the loans are often coupled with higher interest rates and limited opportunity to refinance.
For example, the bureau said less than 30% of manufactured home loan applications are approved, compared to more than 70% of loan approvals for “site-built” homes. The agency noted that around 42% of manufactured home purchase loans are “chattel” loans, which are secured by the home but not the land. In general, the bureau asserted, chattel loans have higher interest rates and fewer consumer protections than mortgages.
Less than 4% of chattel loan originations were for refinancing, the bureau said.
Hispanic, Black and African American, American Indian and Alaska Native, and elderly borrowers are more likely than other consumers to take out chattel loans, even after controlling for land ownership, CFPB said. Black and African American borrowers are the only racial group that are underrepresented in manufactured housing lending overall compared to site-built, the bureau said, but overrepresented in chattel lending compared to site-built.
(May 21, 2021) Reporting exemptions on home mortgage lending data for smaller credit unions and banks had little impact on data availability, but more information from the lenders would help oversight, a report from the congressional Government Accountability Office (GAO) stated this week.
The report noted that banks and credit unions that don’t do a lot of mortgage lending (but, in any event, some lending) are exempt from reporting mortgage lending data such as debt-to-income ratios and credit scores under changes made to the Home Mortgage Disclosure Act (HMDA) in 2018. “Although these exemptions minimally affected data availability, regulators still need to verify whether lenders are eligible to use them,” GAO said.
According to the watchdog agency, 3% of the new HMDA data were not reported because of partial exemptions for the 2018 and 2019 HMDA data GAO reviewed. At the local level, the agency said, in most census tracts, at least 91% of data GAO reviewed were available in 2019.
“Partial exemptions did not disproportionately affect the availability of HMDA data GAO reviewed for borrowers of any race, ethnicity, or income level,” the agency stated.
However, GAO stated, regulators could not verify some lenders’ eligibility for partial exemptions because not all HMDA reporting included data on whether each loan is an open-end line of credit. “This data point is one of the new data points required since 2018, and lenders with exemptions are not required to provide it. Without it, however, it is difficult for regulators to determine if the lender is below the loan volume level required for partial exemption eligibility,” the report sates.
GAO said the HMDA data that lenders with partial exemptions are required to submit are set in statute. However, it said, if Congress were to make reporting of open-end lines of credit mandatory for all HMDA reporters, including those with partial exemption, regulators could more readily confirm lenders’ eligibility for partial exemption.
In addition, GAO said, CFPB has other data that are useful in determining lenders’ eligibility, such as type of lender. “CFPB does not plan to analyze these data for the other regulators, stating that they have access to the data through other sources,” GAO stated. “However, it would be more efficient—and reduce duplication of effort among regulators—for CFPB to synthesize and share data with regulators to assist them in assessing lenders’ partial exemption compliance.”
(April 2, 2021) Seven policy statements issued in 2020 from late March to early June that provided temporary flexibilities to financial institutions in the areas of consumer mortgages, credit reporting, credit cards, and prepaid cards are rescinded as of April 1 (Thursday), the Consumer Financial Protection Bureau (CFPB) announced this week.
The bureau also said it was rescinding its 2018 bulletin on supervisory communications and replacing it with a revised one describing its use of matters requiring attention (MRAs) “to effectively convey supervisory expectations.” That new bulletin, 2021-01, states that “effective immediately,” the bureau will no longer use “supervisory recommendations” in these communications.
“We are now over a year into the disruptive and deadly COVID-19 crisis. The virus has affected industry as well as consumers, but individuals and families have been hardest-hit by the pandemic’s health and economic impacts,” said CFPB Acting Director Dave Uejio. “Providing regulatory flexibility to companies should not come at the expense of consumers. Because many financial institutions have developed more robust remote capabilities and demonstrated improved operations, it is no longer prudent to maintain these flexibilities. The CFPB’s first priority, today and always, is protecting consumers from harm.”
The rescinded policy statements were issued between March 26 through June 3, 2020, and temporarily provided financial institutions with flexibilities regarding certain regulatory filings or compliance with consumer financial laws and regulations. The bureau said the rescissions “reflect the Bureau’s commitment to consumer protection, and the fact that financial institutions have had a year to adapt their operations to the difficulties posed by the pandemic.”
The bureau, in its release, included links to each policy statement rescission notice and the new MRA bulletin.
Rescission of Statement on Bureau Supervisory and Enforcement Response to COVID-19 Pandemic (March 26, 2020)
Rescission of Statement on Supervisory and Enforcement Practices Regarding Quarterly Reporting Under the Home Mortgage Disclosure Act (March 26, 2020
(April 2, 2021) The Oregon Department of Consumer and Business Services has an opening for a mortgage banker/broker examiner (financial examiner 2). The closing date for the position is April 12. For more information, see the NASCUS State Job Announcements page (link below) … Mortgage lending data from 2020 is now available via the FFIEC’s Home Mortgage Disclosure Act (HMDA) platform, it was announced this week. The data, published by the exam council, come from about 4,400 HMDA modified loan application register (LAR) filers … A joint webinar of NCUA and the FDIC will be held April 27 (at 1 p.m.) on youth financial education, in celebration of April as National Financial Capability Month, the credit union and banking agencies announced this week. The 90-minute program will dive into the importance of financial account access and financial education for young people participating in employment programs.
LINKS:
NASCUS State Job Announcements
2020 HMDA Data on Mortgage Lending Now Available
Registration: Account Access and Financial Education for Youth Participating in Employment Programs
(March 5, 2021) A “regulatory alert” outlining Home Mortgage Disclosure Act (HMDA) data collection is outlined by NASCUS in one of the latest summaries to be posted by the association.
The summary is available to members only.
Last month, the agency issued its Regulatory Alert 21-RA-04, which lists the requirements for collecting HMDA data associated with mortgage loan applications processed during 2021. The alert also lists (as further noted in the summary) the HMDA data partial exemptions for certain transactions.