After a shake-up in leadership at the Consumer Financial Protection Bureau, the future of some mortgage policies is uncertain. Here are three that could change and what that might mean for homeowners and homebuyers.
Getting a mortgage today is much different than it was before the financial crisis.
Loans have to meet certain standards and there are many rules lenders and servicers have to follow. But after a shake-up in leadership at the Consumer Financial Protection Bureau (CFPB), the future of some policies is uncertain.
Here’s why: The new acting director of the CFPB, budget director Mick Mulvaney, is expected to review regulations that haven’t been finalized, and he may try to alter rules that are already in place.
Here are three policies Mulvaney could change and what adjustments to them might mean for homeowners and homebuyers. The CFPB has already announced plans to reconsider certain rules.
1. Home Mortgage Disclosure Act
When you apply for a mortgage, some information — including your race, ethnicity and sex — could be released to the public.
For thousands of lenders, reporting mortgage information is mandatory under the Home Mortgage Disclosure Act (HMDA). While the law has been around since 1975, the amount of data made publicly available is increasing, and not everyone is thrilled.
The mortgage industry believes that publishing so much data raises concerns about consumer privacy. And there’s no way to opt out of having your information shared, notes Richard Andreano Jr., partner at the Ballard Spahr law firm.
“They expanded the data set so much that there was a concern that if it was all made public, at what point are borrowers able to be identified using HMDA data?” asks Alexander Monterrubio, director of regulatory affairs at the National Association of Federally-Insured Credit Unions (NAFCU).
Consumer advocates want more information released. Doing so, they argue, protects borrowers from discriminatory lending. It also holds lenders accountable for their actions, says Jaime Weisberg, senior campaign analyst at the Association for Neighborhood & Housing Development.
The latest HMDA requirements go into effect Jan. 1, but the CFPB, the Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency announced that lenders won’t be penalized for mistakes made while collecting data in 2018 or reporting it in 2019. They also won’t have to resubmit data unless errors…