CBAI Urges the CFPB to Ease Community Bank HMDA Requirements

In a May 25, 2017 comment letter to the Consumer Financial Protection Bureau (CFPB), CBAI urged the Bureau to ease the HMDA requirements for community banks. The CFPB finalized the new HMDA rules in October of 2015, but has proposed technical corrections to clarify certain requirements.

In addition to several new recommendations, CBAI also renewed its prior recommendations for the Bureau to scale back the number of additional data fields and not go beyond the Dodd-Frank requirements. CBAI also recommended that the Bureau at least double the error thresholds given the greater number of data fields and the resulting increased likelihood that unintentional errors will occur; and urged an increase in the loan-volume threshold for HMDA reporting to 1,000 closed-end mortgages and 2,000 open-end lines of credit.

Other recommendations included adopting guidance similar to the CFPB’s TRID implementation whereby examiners initially should not find fault in compliance so long as the bank is making a good faith effort to comply with the new regulations; urging the Bureau to be especially mindful of the Government Monitoring Information challenges for community banks and apply the good faith effort standard in determining the initial compliance for community banks; and increasing the implementation period by one year for those banks that require extra time for implementation, but those banks that are fully prepared and implement sooner should be permitted to do so without fear of penalty for earlier compliance if errors occur after good faith efforts to comply. Read CBAI Comment Letter.