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Congressman Tom Emmer

Representing the 6th District of Minnesota

Reps. Emmer & Hultgren Stand Up for Small Businesses and Community Banks, Introduce Legislation to Provide Regulatory Relief

December 18, 2017
Press Release

WASHINGTON, D.C. – Congressman Tom Emmer (MN-06) and Congressman Randy Hultgren (IL-14) continue to stand up for small businesses and community banks, introducing the Home Mortgage Reporting Relief Act (H.R. 4648) this week. The bill gives community banks and credit unions additional time to comply with new, excessive data collection and reporting requirements required by the Consumer Financial Protection Bureau (CFPB).

“I consistently hear from community banks and credit unions throughout the Sixth District that the CFPB’s new rules will make it harder for them to do what they do best: help Minnesota families achieve the American dream,” said Congressman Emmer. “While we work to blunt the impact of these burdensome regulations, this bill will provide Main Street banks additional time to comply with the new rule so that they can focus on getting Americans into new homes in a timely manner rather than figuring out how to navigate through more red tape.”

“The new Home Mortgage Disclosure Act requirements again demonstrate that the CFPB does not understand our community banks and credit unions. Just as one burdensome mortgage rule is finalized, our community financial institutions have to deal with a new rule. This bill will give community banks and credit unions some breathing room so they can refocus on meeting the financial needs of families and small businesses in Illinois,” said Congressman Hultgren.

The Home Mortgage Reporting Relief Act:

  • Provides a one year safe harbor for financial institutions from having to comply with the data collection and reporting requirements, respectively, issued under the CFPB’s October 2015 and September 2017 amendments to the Home Mortgage Disclosure Act (Regulation C).
     
  • Restricts the CFPB’s ability to make any of the new data collected and reported publicly available.
     

Under the Home Mortgage Disclosure Act (HMDA) the CFPB’s revised Regulation C final rule will go into effect on January 1, 2018. The final rule requires banks and credit unions to collect 48 additional unique data fields on any mortgage loan they originate and report this data to the CFPB. This change more than doubles the number of data fields currently required to be collected and will result in small community mortgage lenders to compile a total of 110 data points in order to process a mortgage. These new data fields will cause community financial institutions to divert resources to deal with the additional bureaucratic red tape, increasing costs and the time it takes to process a mortgage for home buyers.

Further, the ultimate publication of this data by the CFPB raises numerous consumer privacy concerns. According to the Department of Treasury’s June 2017 report A Financial System That Creates Economic Opportunities Banks and Credit Unions

“The new reporting requirements have created two concerns among market participants, both related to the public disclosure of the data. The new fields include additional borrower-specific data, which taken with existing HMDA fields and publicly available information, could be used to determine the specific identity of a borrower, raising privacy concerns. Additionally, the new fields contain loan-specific features, including mortgage note rate and fees. The new HMDA loan level data could help competitors re-engineer a lender’s pricing models, which could cause competitive harm to the lender.”

Click here to read the full report.

Congressman Emmer is a member of the House Financial Services Committee.

Additional resources:

Emmer Letter to CFPB Acting Director Mick Mulvaney on new data rule (11/27/17)
Emmer Introduces Home Mortgage Disclosure Adjustment Act (6/21/17)
Emmer Introduces Home Mortgage Disclosure Adjustment Act (4/20/16)

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