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How the CFPB Intends to Protect Consumer Privacy by Modifying Public HMDA Data

Dec 28, 2018 by Brian Arnesen

On December 21, 2018, the CFPB announced a final policy guidance about modifications to public HMDA data to protect consumers’ privacy.

HMDA requires certain financial institutions to collect, report, and disclose data about their mortgage lending activity. HMDA data contains 110 data fields that institutions are required to collect. These include property address, credit score, application date and loan amount. In the past, consumer advocacy groups have raised concerns over privacy stating that public HMDA data contains too much identifying information.

The Bureau will modify the public loan-level HMDA data to exclude:

  • The universal loan identifier (ULI) or non-universal loan identifier (NULI)
  • The date the application was received, or the date shown on the application form
  • The date of action taken by the financial institution on a covered loan or application
  • The address of the property securing the covered loan or, in the case of an application, proposed to secure the covered loan
  • The credit score or scores relied on in making the credit decision
  • the unique identifier assigned by the Nationwide Mortgage Licensing System and Registry for the mortgage loan originator
  • The result generated by the automated underwriting system used by the financial institution to evaluate the application

Additionally, the following free-form text fields will be excluded:

  • Applicant or borrower race
  • Applicant or borrower ethnicity
  • The name and version of the credit scoring model used
  • The principal reason or reasons the financial institution denied the application
  • The automated underwriting system name

In addition to excluding these data fields from public disclosure, the Bureau announced that it would modify values reported for certain fields, such as loan amount, age, and monthly debt to income percentage. This final policy guidance will apply to HMDA data compiled by financial institutions in or after 2018 and made available to the public by the Bureau beginning in 2019.

On January 8th and 9th, QuestSoft held a free HMDA Filing Update webinar to prepare lenders for 2018 HMDA submissions. Click here to watch the recording.