Small Lenders No More?

CFPB Issues HMDA Technical Amendment

By Bill Dolan, CMB, AMP

For those of you not aware of the recent technical amendment to the HMDA rule issued by the Consumer Finance Protection Bureau (CFPB), this technical amendment updates Reg C to reflect the closed-end mortgage loan threshold, pursuant to a recent court decision.

On September 23, 2022, the U.S. District Court for the District of Columbia vacated the increased loan-volume reporting threshold for closed-end mortgage loans that was in the 2020 HMDA Rule.

As a result of this new order on September 23, 2022, the closed-end mortgage loan reporting threshold is now 25 loans or more in each of the two preceding calendar years – this was the threshold that was established by the 2015 HMDA Rule.

SCA’s mortgage banking consultants have been carefully monitoring the rule changes (both procedural and interpretive) so beginning January 1, 2023, if your institution originates and closes more than 25 closed-end mortgages in the year, you will be required to produce a full and complete LAR to the CFPB for your financial institution.

We at SCA are still awaiting any further decisions, possible changes and additional notifications pertaining to HELOC loans (this could still happen prior to year-end) as well.

This may be a service you have been contemplating outsourcing to reduce time and expense going into 2023.’ SCA’s Compliance Analysts are ready to assist in this area, including necessary training within your Compliance, Commercial and Residential Departments. You may also require a “deep dive” within your LOS systems by our Mortgage Technology Consultants to ensure proper set-up of your HMDA screens for proper reporting.   Don’t Wait!!!!!!

Please reach out to Bill Dolan, Director at (617) 694-2627 for a free consultation or visit SCA’s website at www.scapartnering.com to learn more about the services SCA provides to our over 140 clients on a daily basis.