National Monitoring Information needs Under the HMDA plus the ECOA

By Aaron Thompson, Senior Examiner, Federal Reserve Bank of Richmond

Introduction

National monitoring information (GMI) relates to the mortgage applicant demographic data creditors must gather under arizona cash advance Regulation B, which implements the Equal Credit chance Act (ECOA), and Regulation C, which implements the house Mortgage Disclosure Act (HMDA), when customers submit an application for specific home loans. The requirement that is regulatory loan providers to gather such information goes back to 1977 as soon as the Federal Reserve Board (Board) amended Regulation B to require creditors to gather monitoring information about age, intercourse, marital status, and battle or nationwide beginning on home-purchase loans and refinancing deals. 1 The Board explained that these details would help federal regulators detect mortgage lending discrimination. Customer groups additionally thought that this information could be valuable in detecting home loan discrimination that is lending. 2

Likewise, in 1989, the finance institutions Reform, healing and Enforcement Act amended the HMDA to need creditors to gather competition, intercourse, and earnings information from candidates for home loan loans to simply help 3 In 2002, the Board amended Regulation C to conform the number of competition and ethnicity information to modifications used by the working office of Management and Budget. 4 Overall, the range associated with HMDA data collection needs is wider as compared to ECOA’s requirement since the HMDA pertains to all home loans, including home-improvement loans.

On the basis of the regularity of assessment violations, complying with GMI demands could be challenging. From the one hand, Regulation B generally forbids creditors from gathering information on battle, color, faith, nationwide beginning, or intercourse “to discourage discrimination, in line with the premise that when creditors cannot inquire about or note candidates’ individual characteristics, such as for example nationwide beginning or battle, these are typically less likely unlawfully to cons 5 But the legislation also incorporates an exclusion in 12 C.F.R. Continue reading