WASHINGTON (3/14/16)--The increased number of data points required for Home Mortgage Disclosure Act reporting means the resubmission error threshold must be adjusted, the Credit Union National Association (CUNA) said Friday. The Consumer Financial Protection Bureau (CFPB) finalized changes to HMDA in October 2015, adding additional data points that lenders must collect.
In a comment letter to the CFPB regarding the resubmission deadlines, CUNA also called for an exemption for institutions with a low number of applications on their loan/application register (LAR).
“CUNA believes given the drastic increase in data fields, institutions with less than 25,000 LAR entries should be exempt from resubmission. This will still maintain the integrity of the overall HMDA data and provide relief to smaller financial institutions,” the letter reads. “The bureau should tier the thresholds above that, but they should not be as strict as the current guidelines provide.
“Because of the vast increase in data points, the potential for errors has correspondingly increased and thus stricter error rates make little sense,” the letter adds.
The CFPB’s Resubmission Guidelines currently require an institution reporting fewer than 100,000 loans or applications on their LAR to resubmit data when errors are found in either 10% or more of the LAR sample entries; or 5% or more of sample entries within an individual data field.
For institutions reporting more than 100,000 entries, the error rate is reduced to 4% or more of the LAR sample entries; or between 2% and 4% of the sample entries within an individual data field.
Resubmission may be required even if sample error rates are below the thresholds if the errors make the institution’s data unreliable.
CUNA also urged the agency to provide information on which data points will be made public, and in what format they will be made public.
“The availability of this critical information may very well affect our comments made herein, as the validity or importance of a particular data point may take on more significance (or less significance) based on that information,” the letter reads. “As we have expressed in other HMDA related comments, we urge and renew our continued call for the Bureau to make its determination on this issue quickly.”