On October 10, 2019, the Consumer Financial Protection Bureau announced a final rule (opens new window) amending parts of Regulation C, which implements the Home Mortgage Disclosure Act. The final rule, which is effective on January 1, 2020, extends Regulation C’s temporary institutional and transactional coverage threshold of 500 open-end lines of credit for another two years. The final rule also updates Regulation C to implement the partial exemptions created in HMDA by the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA).
Open-End Coverage Threshold
The final rule extends the current temporary threshold of 500 open-end lines of credit for open-end institutional and transactional coverage to January 1, 2022. For data collection years 2020 and 2021, credit unions that originated fewer than 500 open-end lines of credit in either of the two preceding calendar years will not need to collect, record, or report data with respect to open-end lines of credit.
Incorporating the EGRRCPA Partial Exemptions into Regulation C
The final rule also incorporates into Regulation C the interpretations and procedures from the 2018 rule (opens new window) the CFPB issued to implement and clarify the HMDA partial exemptions created by the EGRRCPA. Specifically, the final rule incorporates provisions from the 2018 rule which:
- Clarify that insured credit unions covered by a partial exemption have the option to report exempt data fields as long as they report all data fields that the data point comprises;
- Stipulate that only loans and lines of credit that are otherwise reportable under Regulation C count towards the thresholds for the partial exemptions;
- Explain which of the data points in Regulation C are covered by the partial exemptions; and
- Designate a non-universal loan identifier for certain partially exempt transactions.
The final rule further implements the EGRRCPA by addressing certain issues relating to the partial exemptions that the 2018 rule did not address, such as how to determine whether a partial exemption applies after a merger or acquisition.
The CFPB intends to issue a separate final rule in 2020 that addresses recent proposals regarding permanent coverage thresholds for open-end lines of credit and closed-end mortgage loans.
Credit unions should read the provisions of the final rule and Regulation C to determine the potential effects on their operations. To access Regulation C, go to https://www.ecfr.gov/cgi-bin/text-idx?SID=dffdd8c9649e61257a630592cef19b6b&mc=true&node=pt12.8.1003&rgn=div5 (opens new window).
Please contact the Office of Consumer Financial Protection at 703.518.1140 or by email at ComplianceMail@ncua.gov if you have questions. You can also contact your NCUA regional office or your state supervisory authority, if applicable.