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. 19, 2021) Four new summaries have been posted by NASCUS, looking at recent actions from NCUA, which include: two regulatory alerts, a final rule on supervisory guidance, and (along with other federal regulators) answers to questions about anti-money laundering activities.
All four of the summaries are available to members only.
The summaries on regulatory alerts from NCUA look at two issued earlier this month: the first on 2021 threshold adjustments under Regs C, Z and V; the second on submission of 2020 Home Mortgage Disclosure Act (HMDA) data. The first alert (21-RA-02) notes that, in January, the bureau published annual adjustments for exemption thresholds under the Home Mortgage Disclosure Act (HMDA, Regulation C) and the Truth in Lending Act (TILA, Regulation Z). The asset-size thresholds, the alert points out, exempt some credit unions from data collection under Regulation C and from escrow account requirements for higher-priced mortgage loans and specific qualified mortgages under Regulation Z.
The alert also notes that the CFPB published an annual adjustment to the maximum amount consumer reporting agencies may charge consumers for making a file disclosure to a consumer under Regulation V.
The second alert (21-RA-03) reminds credit unions with $47 million or more in assets that they have until March 1 to file reports on home mortgage loan applications made last year under HMDA (as implemented by the CFPB’s Reg C). There are some limiting provisions for reporting under the rule, the agency pointed out in the alert. For example, the closed-end mortgage loan threshold increased from 25 to 100 effective July 1, 2020. “Credit unions that originated fewer than 100 covered closed-end mortgage loans in 2018 or 2019 are not required to report any closed-end mortgage loan information for 2020,” the agency wrote, noting that Section 1003.3(c) of Regulation C lists excluded (not covered) transactions.
The third summary from NASCUS looks at the agency’s final rule on supervisory guidance. Issued early this month. Under the rule, aimed at clarifying and codifying the role of supervisory guidance, the meaning of “supervisory guidance” is clarified as meaning, essentially, it doesn’t have the force of law. As finalized, it codifies an interagency statement issued by NCUA and other federal financial institution regulators in September 2018.
The final summary from NASCUS this week outlines “frequently asked questions” (FAQs) about suspicious activity reporting and other anti-money laundering considerations released by NCUA, Treasury’s Financial Crimes Enforcement Network (FinCEN) and federal banking agencies. According to the agencies, the FAQs clarify the regulatory requirements related to suspicious activity reporting to assist credit unions and other financial institutions with their compliance obligations. The FAQs also enable financial institutions to focus resources on activities that produce the greatest value to law enforcement agencies and other government users of Bank Secrecy Act (BSA) reporting, the agencies said.
NASCUS Summary: Final Rule Summary: Role of Supervisory Guidance (Part 791, Subpart D) (member only)
(Feb. 12, 2021) Credit unions required to file reports on home mortgage loan applications made last year have until March 1 to do so, NCUA reminded this week in a Regulatory Alert.
In the alert (21-RA-03), the agency said all federally insured credit unions with assets of more than $47 million in assets as of Dec. 31, 2019, must file the application reports as required under the Home Mortgage Disclosure Act (HMDA), and implemented by the Consumer Financial Protection Bureau’s (CFPB’s) Regulation C.
There are some limiting provisions for reporting under the rule, the agency pointed out. For example, the closed-end mortgage loan threshold increased from 25 to 100 effective July 1, 2020. “Credit unions that originated fewer than 100 covered closed-end mortgage loans in 2018 or 2019 are not required to report any closed-end mortgage loan information for 2020,” the agency wrote, noting that Section 1003.3(c) of Regulation C lists excluded (not covered) transactions.
All data submitted, the agency said, must be done through the Federal Financial Institution Examination Council’s (FFIEC) HMDA Platform and that no other submission methods are permitted. An authorized representative of the credit union with knowledge of the data submitted must certify to the accuracy and completeness of the data submitted, the agency noted.
LINK:
Submission of 2020 Home Mortgage Disclosure Act Data (NCUA Regulatory Alert, 21-RA-03)
(Feb. 5, 2021) A regulatory alert focusing on 2021 threshold adjustments published by CFPB for Regulations C, Z and V was issued this week by NCUA, noting that all three were effective Jan. 1.
The alert notes that, in January, the bureau published annual adjustments for exemption thresholds under the Home Mortgage Disclosure Act (Regulation C) and the Truth in Lending Act (Regulation Z). The asset-size thresholds, the alert points out, exempt some credit unions from data collection under Regulation C and from escrow account requirements for higher-priced mortgage loans and specific qualified mortgages under Regulation Z.
The CFPB published an annual adjustment to the maximum amount consumer reporting agencies may charge consumers for making a file disclosure to a consumer under Regulation V, the alert also notes
More specifically the alert states:
- The Reg C exemption threshold increased to $48 million (meaning credit unions with $48 million or less in assets as of Dec. 31, 2020, are exempt from collecting HMDA data this year);
- The Reg Z escrow and small creditor qualified mortgages (QMs) asset-size exemption threshold increased to $2.23 billion (meaning lenders with assets of less than $2.23 billion at the end of last year are expect if other provisions of Reg Z are also met). The limit also applies during a grace period, in certain circumstances, with respect to transactions with applications received before April 1, 2022.
- The ceiling on the allowable amount a consumer reporting agency may charge for a consumer report in 2021 increased to $13. “The ceiling does not affect the amount a credit union may charge its members or potential members, directly or indirectly, for obtaining a credit report in the normal course of business,” NCUA noted.
(Jan. 8, 2021) Credit unions and banks with assets of $48 million or less as of Dec. 31 are exempt from collecting data in 2021 under Regulation C (Home Mortgage Disclosure), the CFPB said last month in setting the regulation’s annual asset-size threshold.
The bureau said the $1 million upward adjustment in the threshold from last year was based on a 1.3% increase in the average of the CPI-W for the 12-month period ending in November 2020. As it usually does, the bureau noted that an institution’s exemption from collecting data in 2021 does not affect its responsibility to report data it was required to collect in 2020.
Also announced by the bureau: its adjustment to Regulation Z thresholds, stating that creditors with assets of less than $2.23 billion (including assets of certain affiliates) as of Dec. 31 are exempt, if other requirements of Regulation Z also are met, from establishing escrow accounts for higher-priced mortgage loans in 2021.
LINKS:
Regulation C notice