The Consumer Financial Protection Bureau has released a new online mortgage tool sifting through Home Mortgage Disclosure Act data, allowing the public to learn more about residential mortgage trends with certain loan products and gather a better understanding of borrowers’ access to credit. But CFPB views this tool as only the first step in requiring lenders to disclose even more information that could be helpful to consumers and housing agencies under the HMDA.
“Better public HMDA data would help us improve upon an important resource that already allows regulators, government agencies, housing groups, and consumer rights groups to study and monitor the single most important consumer financial product in the United States: the mortgage loan,” says Richard Cordray, director of the CFPB.
HMDA, enacted in 1975, requires lenders to disclose information about home mortgage loans. The information is used by financial regulators to monitor whether lenders are serving the housing needs of the public, and to help determine the level of access to residential mortgage credit. The information that lenders currently report includes:
• name of the lender
• type and general location of the property
• race, ethnicity, and sex of the applicant
• loan amount
• whether the loan is for purchasing a home, refinancing an existing mortgage, or home improvement
But CFPB wants to expand what lenders must report under the law, and it’s seeking feedback to determine new data points to create for future reporting.
“We are considering asking financial institutions to include more underwriting and pricing information, such as an applicant’s debt-to-income ratio, the interest rate, the total origination charges, and the total discount points of the loan,” says Cordray. “This will help regulators spot troublesome trends in mortgage markets around the country.”
The agency is also weighing having lenders report the borrower’s age and credit score, the term of the loan, and whether the loan meets the qualified mortgage standard.
Source: “Consumer Bureau Introduces New Mortgage Tool,” Credit.com (Feb. 7, 2014) and “CFPB Unveils New Consumer-Friendly HMDA Tool,” National Mortgage Professional Magazine (Feb. 7, 2014)
