CFPB Clarifies HMDA Rule
The Consumer Financial Protection Bureau (CFPB) in April issued a set of clarifications to its 2015 Home Mortgage Disclosure Act (HMDA) rule and has gathered industry feedback on the proposed changes.
The changes reflect “the bureau’s ongoing and substantive engagement with stakeholders in the marketplace and will help [the] industry meet its new reporting obligations,” says Richard Cordray, director of the CFPB, in a release.
The 150-page set of changes was open for public comment for 30 days after its publication in the Federal Register, which took place in April.
The bulk of the new reporting requirements, as per the 2015 final rule, are to take effect Jan. 1, 2018.
The bulk of the proposed changes simply clarify language as opposed to adjusting the rules themselves. Among the numerous technical corrections and minor changes is clarification of certain key terms, such as “temporary financing” and “automated underwriting system.”
The proposal would also establish transition rules for two data points, loan purpose and the unique identifier for the loan originator. The transition rules would permit financial institutions to report “not applicable” for these data points when reporting certain loans that they purchased that were originated before certain regulatory requirements took effect.
Dan Berger, president and CEO of the National Association of Federally-Insured Credit Unions (NAFCU), says although the association “appreciates the clarifications, the rule still represents a huge regulatory burden for credit unions.”
“NAFCU strongly encourages the bureau to reconsider its enormous expansion of the HMDA data collection set, raise the exemption thresholds and delay implementation of this rule to give credit unions more time to prepare,” Berger further adds in a statement.
The CFPB dialed back the reporting requirements for the rule after it was first introduced in 2014 by exempting lenders that originate fewer than 25 mortgages a year and by allowing financial institutions with high volume to submit HMDA data on a quarterly basis rather than an annual basis. The bureau also sought to align HMDA data requirements with well-established industry data standards.
Regardless, most mortgage lenders feel over-burdened by the new rules: Not only do they make mortgage operations more complex and costly, but they also could potentially result in major enforcement action by the CFPB, as well as lawsuits, due to minor errors resulting from technical glitches.
Keith Noreika To Serve As Acting Comptroller Of The Currency
Keith A. Noreika will serve as acting comptroller of the currency, filling in for departing Comptroller of the Currency Thomas J. Curry, who left the position on May 5.
“Serving as comptroller of the currency has been the highlight of my career,” Curry says in a release. “The comptroller is a special job, and I am proud to have served with 4,000 men and women who showed such deep dedication to the agency’s mission of ensuring the safety and soundness of the federal banking system and the fair treatment of its customers.”
Curry, who completed his five-year term on April 9, plans to return home to Boston, according to the release.
Noreika is currently a partner at Simpson Thacher & Bartlett LLP and was a partner at Covington & Burling, specializing in banking regulation. He has extensive experience advising regional, multinational and other banks on structuring their operations, including compliance with the Volcker Rule and Consumer Financial Protection Bureau regulations, as well as the Bank Secrecy Act and anti-money-laundering rules.
Noreika has represented national banks before the Supreme Court and has worked extensively with all federal bank regulatory agencies. He has also served as an adjunct faculty member at the University of Pennsylvania Law School and the University of Virginia School of Law.
Trump Taps Pam Patenaude To Become Next HUD Deputy Secretary
The Trump administration in late April announced its intent to nominate Pam Patenaude to serve as the next deputy secretary of the U.S. Department of Housing and Urban Development (HUD).
Patenaude – who some previously speculated would be Trump’s pick to become HUD secretary – has more than 25 years of experience in housing, community economic development, real estate and public policy. She is president of the J. Ronald Terwilliger Foundation for Housing America’s Families.
She previously served as assistant secretary for community, planning and development for HUD during the George W. Bush administration. She is also the former director of housing policy at the Bipartisan Policy Center.
“Pam is an exceptional choice for the position,” says David H. Stevens, CMB and president and CEO of the Mortgage Bankers Association, in a statement. “Personally, I have worked with her for a number of years, and she is exactly the kind of leader who will help support the secretary and also address the critical issues ahead for HUD. She has a well-informed understanding of the agency and essential technical knowledge of the real estate finance industry. I would encourage the Senate to move swiftly in confirming her nomination.”