This article on H.R. 2954, the Home Mortgage Disclosure Act, was published in the Wall Street Journal, January 12, 2018. Read the full article here.
The legislation would allow a significant proportion of community banks and credit unions to escape reporting requirements that came into effect this month. The new requirements fall under the Home Mortgage Disclosure Act, a law enacted in 1975 to curb discrimination against minority borrowers.
The bill introduced by Rep. Tom Emmer (R., Minn.) has a good chance of becoming law because a broad Senate financial-deregulation bill, introduced in November with bipartisan support, includes a similar provision. Mr. Emmer said he expected a few House Democrats to support his bill.
The bill is expected to cover roughly a quarter of the U.S. mortgage market, Mr. Emmer said in an interview.
“These thresholds will still require the Wells Fargos, Bank of Americas and JPMorgans of the world to report data but it will provide relief to little guys, community banks and credit unions,” he said.
Financial institutions, particularly community banks and credit unions, have complained about new disclosure requirements, citing compliance costs and data-security concerns.
Specifically, the legislation would expand the exemption to lenders that originate fewer than 500 closed-end mortgage loans in each of the two preceding calendar years, up from 25 loans currently. The threshold for open-end home-equity lines of credit would be raised to 500 loans a year from 100 loans currently.