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CBA Submits Comment Letter on HMDA
On Monday, March 14, 2016, CBA and the American Bankers Association filed a joint comment in response to the CFPB’s Request for Information (RFI) regarding the Home Mortgage Disclosure Act (HMDA) Resubmission Guidelines. CBA urged the Bureau to consider the breadth of mortgage providers and the wide range of mortgage products they offer to meet consumers’ home finance needs. “Guidelines that are too restrictive or that do not take into account that variety will constrain the availability of both products and providers, undermining the industry’s ability to serve the credit needs of borrowers, particularly less qualified applicants,” the letter stated.
CBA recommended the CFPB:
- Eliminate the current File Error Rate percentage metric;
- Identify key and non-key fields and assign reasonable field error rate percentage thresholds reflecting their importance to the identification of possible discriminatory lending patterns and distribution of public sector investments;
- Institute reasonable tolerances and rounding guidelines; and
- Require examiners to assess and articulate whether the error rates identified and the nature of the errors would have material impacts on HMDA analysis before requiring resubmission.
In addition, CBA stressed the Resubmission Guidelines should ensure when an institution is required to incur the costs to update and resubmit its HMDA data. The resubmitted data are incorporated into the data otherwise made publicly available, which is not the current practice. The associations also wrote it is vital the Bureau coordinate with the prudential regulators to establish a consistent standard across examinations.