This section of the FEDERAL REGISTER

contains regulatory documents having general

applicability and legal effect, most of which

are keyed to and codified in the Code of

Federal Regulations, which is published under

50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by

the Superintendent of Documents.

Rules and Regulations Federal Register

45325 

Vol. 83, No. 174 

Friday, September 7, 2018 

1Public Law 115–174, 132 Stat. 1296 (2018). 

2 12 CFR 1003.1. 

3As used in this interpretive and procedural rule, 

the term ‘‘data point’’ refers to items of information 

that entities are required to compile and report, 

generally listed in separate paragraphs in 

Regulation C. Some data points are reported using 

multiple data fields. 

4Public Law 111–203, 124 Stat. 1376, 1980, 

2035–38, 2097–101 (2010). 

5 Dodd-Frank Act section 1094(3), amending 

HMDA section 304(b), 12 U.S.C. 2803(b). 

BUREAU OF CONSUMER FINANCIAL 

PROTECTION 

12 CFR Part 1003 

RIN 3170–AA81 

Partial Exemptions From the 

Requirements of the Home Mortgage 

Disclosure Act Under the Economic 

Growth, Regulatory Relief, and 

Consumer Protection Act (Regulation 

C) 

AGENCY: Bureau of Consumer Financial 

Protection. 

ACTION: Interpretive and procedural 

rule. 

SUMMARY: The Bureau of Consumer 

Financial Protection (Bureau) is issuing 

an interpretive and procedural rule to 

implement and clarify the requirements 

of section 104(a) of the Economic 

Growth, Regulatory Relief, and 

Consumer Protection Act, which 

amended certain provisions of the Home 

Mortgage Disclosure Act. 

DATES: This interpretive and procedural 

rule is effective on September 7, 2018. 

FOR FURTHER INFORMATION CONTACT: 

Rachel Ross, Project Analyst; Alexandra 

Reimelt, Counsel; or Amanda Quester, 

Senior Counsel, Office of Regulations, at 

202–435–7700 or https://

reginquiries.consumerfinance.gov/. If 

you require this document in an 

alternative electronic format, please 

contact CFPB_Accessibility@cfpb.gov. 

SUPPLEMENTARY INFORMATION: 

I. Summary 

On May 24, 2018, the President 

signed the Economic Growth, 

Regulatory Relief, and Consumer 

Protection Act (the Act) into law.1

Section 104(a) of the Act amends 

section 304(i) of the Home Mortgage 

Disclosure Act (HMDA) by adding 

partial exemptions from HMDA’s 

requirements for certain insured 

depository institutions and insured 

credit unions. Financial institutions 

have raised questions about the new 

partial HMDA exemptions and how the 

exemptions affect collection and 

reporting of data for transactions with 

final action taken in 2018 or subsequent 

years. To provide timely answers to 

these questions, the Bureau is issuing 

this interpretive and procedural rule 

that implements and clarifies section 

104(a) of the Act and effectuates the 

purposes of the Act and HMDA. 

The rule clarifies that insured 

depository institutions and insured 

credit unions covered by a partial 

exemption have the option of reporting 

exempt data fields as long as they report 

all data fields within any exempt data 

point for which they report data; 

clarifies that only loans and lines of 

credit that are otherwise HMDA 

reportable count toward the thresholds 

for the partial exemptions; clarifies 

which of the data points in Regulation 

C are covered by the partial exemptions; 

designates a non-universal loan 

identifier for partially exempt 

transactions for institutions that choose 

not to report a universal loan identifier; 

and clarifies the exception to the partial 

exemptions for negative Community 

Reinvestment Act examination history. 

At a later date, the Bureau anticipates 

that it will initiate a notice-andcomment rulemaking to incorporate 

these interpretations and procedures 

into Regulation C and further 

implement the Act. 

II. Background 

A. Home Mortgage Disclosure Act and 

Regulation C 

The Home Mortgage Disclosure Act 

(HMDA), 12 U.S.C. 2801 through 2810, 

requires certain depository institutions 

and for-profit nondepository institutions 

to collect, report, and disclose data 

about originations and purchases of 

mortgage loans, as well as mortgage loan 

applications that do not result in 

originations (for example, applications 

that are denied or withdrawn). The 

purposes of HMDA are to provide the 

public with loan data that can be used: 

(i) To help determine whether financial 

institutions are serving the housing 

needs of their communities; (ii) to assist 

public officials in distributing publicsector investment so as to attract private 

investment to areas where it is needed; 

and (iii) to assist in identifying possible 

discriminatory lending patterns and 

enforcing antidiscrimination statutes.2

Regulation C, 12 CFR part 1003, 

implements HMDA. Prior to enactment 

of the Dodd-Frank Wall Street Reform 

and Consumer Protection Act (DoddFrank Act), Regulation C required 

reporting of 22 data points and allowed 

for optional reporting of reasons an 

institution denied an application.3

B. Dodd-Frank Act 

In 2010, Congress enacted the DoddFrank Act, which amended HMDA and 

also transferred HMDA rulemaking 

authority and other functions from the 

Board of Governors of the Federal 

Reserve System (Board) to the Bureau.4

Among other changes, the Dodd-Frank 

Act expanded the scope of information 

relating to mortgage applications and 

loans that institutions must compile, 

maintain, and report under HMDA. 

Specifically, the Dodd-Frank Act 

amended HMDA section 304(b)(4) by 

adding one new data point, the age of 

loan applicants and mortgagors. The 

Dodd-Frank Act also added new HMDA 

section 304(b)(5) and (6), which requires 

the following additional new data 

points: information relating to the total 

points and fees payable at origination 

(total loan costs or total points and fees); 

the difference between the annual 

percentage rate (APR) associated with 

the loan and a benchmark rate or rates 

for all loans (rate spread); the term of 

any prepayment penalty; the value of 

real property to be pledged as collateral; 

the term of the loan and of any 

introductory interest rate on the loan; 

the presence of contract terms allowing 

non-amortizing payments; the channel 

through which the application was 

made; and the credit scores of 

applicants and mortgagors.5 New 

HMDA section 304(b)(6) in addition 

authorizes the Bureau to require, ‘‘as [it] 

may determine to be appropriate,’’ a 

unique identifier that identifies the loan 

originator, a universal loan identifier 

(ULI), and the parcel number that 

corresponds to the real property pledged 


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6 Id. 

7 Id. 

8Home Mortgage Disclosure (Regulation C), 80 FR 

66128 (Oct. 28, 2015). 

9The following 12 data points in 12 CFR 

1003.4(a) implement specific provisions in HMDA 

section 304(b)(5)(A) through (C) or (b)(6)(A) through 

(I): ULI (1003.4(a)(1)(i)); property address 

(1003.4(a)(9)(i)); rate spread (1003.4(a)(12)); credit 

score (1003.4(a)(15)); total loan costs or total points 

and fees (1003.4(a)(17)); prepayment penalty term 

(1003.4(a)(22)); loan term (1003.4(a)(25)); 

introductory rate period (1003.4(a)(26)); nonamortizing features (1003.4(a)(27)); property value 

(1003.4(a)(28)); application channel (1003.4(a)(33)); 

and mortgage loan originator identifier 

(1003.4(a)(34)). Id. 

10For example, the 2015 HMDA Final Rule added 

a requirement to report debt-to-income ratio in 

§ 1003.4(a)(23). Id. at 66218–20. 

11For example, the 2015 HMDA Final Rule 

replaced property type with number of total units 

and construction method in § 1003.4(a)(5) and (31). 

Id. at 66180–81, 66227. It also requires 

disaggregation of ethnicity and race information in 

§ 1003.4(a)(10)(i). Id. at 66187–94. 

12 Id. at 66128. 

13 Id. 

14 Id. at 66128, 66256–58. 

15Home Mortgage Disclosure (Regulation C), 82 

FR 43088 (Sept. 13, 2017). 

16 Id. at 43095. The 2017 HMDA Final Rule also, 

among other things, replaced ‘‘each’’ with ‘‘either’’ 

in § 1003.3(c)(11) and (12) to correct a drafting error 

and to ensure that the exclusion provided in that 

section mirrors the loan-volume threshold for 

financial institutions in § 1003.2(g). Id. at 43100, 

43102. 

17Bureau of Consumer Fin. Prot., ‘‘Statement 

with Respect to HMDA Implementation’’ (Dec. 21, 

2017), https://files.consumerfinance.gov/f/ 

documents/cfpb_statement-with-respect-to-hmdaimplementation_122017.pdf. 

18The statement also indicated that collection 

and submission of the 2018 HMDA data will 

provide financial institutions an opportunity to 

identify any gaps in their implementation of 

amended Regulation C and make improvements in 

their HMDA compliance management systems for 

future years. Id. 

19For purposes of HMDA section 104, the Act 

provides that the term ‘‘insured credit union’’ has 

the meaning given the term in section 101 of the 

Federal Credit Union Act, 12 U.S.C. 1752, and the 

term ‘‘insured depository institution’’ has the 

meaning given the term in section 3 of the Federal 

Deposit Insurance Act, 12 U.S.C. 1813. 

20 12 U.S.C. 2906(b)(2). 

21See, e.g., Bureau of Consumer Fin. Prot., 

‘‘Statement on the Implementation of the Economic 

Growth, Regulatory Relief, and Consumer 

Protection Act Amendments to the Home Mortgage 

Disclosure Act’’ (July 25, 2018), https://

www.consumerfinance.gov/about-us/newsroom/ 

bureau-consumer-financial-protection-issuesstatement-implementation-economic-growthregulatory-relief-and-consumer-protection-actamendments-home-mortgage-disclosure-act/. 

22 12 U.S.C. 2804(a). 

as collateral for the mortgage loan.6 New 

HMDA section 304(b)(5)(D) and (b)(6)(J) 

further provides the Bureau with the 

authority to mandate reporting of ‘‘such 

other information as the Bureau may 

require.’’ 7

C. 2015 and 2017 HMDA Final Rules 

In October 2015, the Bureau issued a 

final rule implementing the Dodd-Frank 

Act amendments to HMDA (2015 

HMDA Final Rule).8 The 2015 HMDA 

Final Rule implemented the new data 

points specified in the Dodd-Frank Act,9

added a number of additional data 

points pursuant to the Bureau’s 

discretionary authority under HMDA 

section 304(b)(5) and (6),10 and made 

revisions to certain pre-existing data 

points to clarify their requirements, 

provide greater specificity in reporting, 

and align certain data points more 

closely with industry data standards,11

among other changes. 

The 2015 HMDA Final Rule also 

established transactional thresholds that 

determine whether financial institutions 

are required to collect and report data 

on open-end lines of credit or closedend mortgage loans.12 The 2015 HMDA 

Final Rule set the closed-end threshold 

at 25 loans in each of the two preceding 

calendar years and the open-end 

threshold at 100 open-end lines of credit 

in each of the two preceding calendar 

years.13 Most of the 2015 HMDA Final 

Rule took effect on January 1, 2018.14

After issuing the 2015 HMDA Final 

Rule, the Bureau heard concerns that 

the open-end threshold of 100 

transactions was too low. In August 

2017, the Bureau finalized a rule after 

notice and comment (2017 HMDA Final 

Rule) that temporarily increases the 

open-end threshold to 500 open-end 

lines of credit for calendar years 2018 

and 2019.15 In doing so, the Bureau 

indicated that the two-year period 

would allow time for the Bureau to 

decide, through an additional 

rulemaking, whether any permanent 

adjustments to the open-end threshold 

are needed.16

Recognizing the significant systems 

and operations challenges needed to 

adjust to the revised regulation, the 

Bureau issued a statement in December 

2017 indicating that, for HMDA data 

collected in 2018 and reported in 2019, 

the Bureau does not intend to require 

data resubmission unless data errors are 

material.17 The statement also explained 

that the Bureau does not intend to 

assess penalties with respect to errors in 

data collected in 2018 and reported in 

2019.18 As explained in the statement, 

any supervisory examinations of 2018 

HMDA data will be diagnostic to help 

institutions identify compliance 

weaknesses and will credit good-faith 

compliance efforts. The Board, the 

Federal Deposit Insurance Corporation 

(FDIC), the National Credit Union 

Administration (NCUA), and the Office 

of the Comptroller of the Currency 

(OCC) released similar statements. 

D. Economic Growth, Regulatory Relief, 

and Consumer Protection Act 

Section 104(a) of the Act amends 

HMDA section 304(i) by adding partial 

exemptions from HMDA’s requirements 

for certain insured depository 

institutions and insured credit unions.19

New HMDA section 304(i)(1) provides 

that the requirements of HMDA section 

304(b)(5) and (6) shall not apply with 

respect to closed-end mortgage loans of 

an insured depository institution or 

insured credit union if it originated 

fewer than 500 closed-end mortgage 

loans in each of the two preceding 

calendar years. New HMDA section 

304(i)(2) provides that the requirements 

of HMDA section 304(b)(5) and (6) shall 

not apply with respect to open-end lines 

of credit of an insured depository 

institution or insured credit union if it 

originated fewer than 500 open-end 

lines of credit in each of the two 

preceding calendar years. 

Notwithstanding the new partial 

exemptions, new HMDA section 

304(i)(3) provides that an insured 

depository institution must comply with 

HMDA section 304(b)(5) and (6) if it has 

received a rating of ‘‘needs to improve 

record of meeting community credit 

needs’’ during each of its two most 

recent examinations or a rating of 

‘‘substantial noncompliance in meeting 

community credit needs’’ on its most 

recent examination under section 

807(b)(2) of the Community 

Reinvestment Act of 1977.20

The Act does not provide an effective 

date for section 104(a). Because there is 

no specific effective date and because 

there are no other statutory indications 

that section 104(a) becomes effective 

upon regulatory action or some other 

event or condition, the Bureau believes 

that the best interpretation is that 

section 104(a) took effect when the Act 

became law on May 24, 2018. On July 

5, 2018, the Bureau, the Board, the 

FDIC, the NCUA, and the OCC released 

statements reiterating or referring to 

their December 2017 compliance 

statements, providing information about 

formatting and submission of 2018 loan/ 

application registers, and indicating that 

the Bureau expected to issue guidance 

this summer on the applicability of the 

Act to HMDA data collected in 2018.21

III. Legal Authority 

The Bureau issues this rule pursuant 

to the authority granted by the DoddFrank Act and HMDA. HMDA 

authorizes the Bureau to prescribe 

regulations that it finds necessary to 

carry out HMDA’s purposes.22 As 

mentioned earlier, the Dodd-Frank Act 

transferred to the Bureau the ‘‘consumer 

financial protection functions’’ 

previously vested in certain other 


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Federal Register / Vol. 83, No. 174 / Friday, September 7, 2018 / Rules and Regulations 45327 

23 12 U.S.C. 5581. The Dodd-Frank Act also 

replaced the term ‘‘Board’’ with ‘‘Bureau’’ in most 

places in HMDA. 24 12 U.S.C. 5581(a)(1)(A). 25 12 U.S.C. 5512(b)(1). 26 12 U.S.C. 5481(12)(K); 12 U.S.C. 5481(14). 27The Act’s two partial exemptions operate 

independently of one another. Thus, an insured 

depository institution or insured credit union could 

be eligible in a given calendar year for one of the 

partial exemptions but not the other. For example, 

if an insured depository institution that does not 

have a negative Community Reinvestment Act 

examination history originated fewer than 500 

closed-end mortgage loans in each of the two 

preceding calendar years but originated 500 or more 

open-end lines of credit in either of the two 

preceding calendar years, it is eligible for the partial 

exemption for its closed-end loans but is not 

eligible for the partial exemption for its open-end 

lines of credit. In this circumstance, the institution 

is not required to collect and report exempt data for 

its closed-end loans. It also collects and reports 

complete data for its open-end lines of credit unless 

it qualifies for a complete regulatory exclusion 

under Regulation C, §§ 1003.2(g)(1)(v) and 

1003.3(c)(12). 

28The Bureau interprets the Act to apply to data 

that are collected or reported under HMDA on or 

after May 24, 2018. Because data collected from 

January 1, 2018, to May 23, 2018, would not be 

reported until early in 2019, the Act relieves 

insured depository institutions and insured credit 

unions that are eligible for a partial exemption 

under the Act of the obligation to report certain data 

in 2019 that may have been collected before May 

24, 2018. If optional reporting of data covered by 

a partial exemption were not permitted, such 

institutions would have to remove exempt data 

previously collected, before submitting their 2018 

data in early 2019, a process that could be 

burdensome for some institutions. 

29The HMDA edit checks are rules to assist filers 

in checking the accuracy of HMDA data prior to 

submission. The Filing Instructions Guide for 

HMDA Data Collected in 2018 (2018 FIG), a 

compendium of resources to help financial 

institutions file HMDA data collected in 2018 with 

the Bureau in 2019, explains that there are four 

types of edit checks: syntactical, validity, quality, 

and macro quality. Table 2 (Loan/Application 

Register) in the 2018 FIG identifies the data fields 

currently associated with each data point. See Fed. 

Fin. Insts. Examination Council, ‘‘Filing 

Instructions Guide for HMDA Data Collected in 

2018’’ (2018 FIG), at 21–54, https://

www.consumerfinance.gov/data-research/hmda/ 

static/for-filers/2018/2018-hmda-fig.pdf; see also 

supra note 3 (discussing the relationship between 

data points and data fields). 

30Reporting the State data field is subject to the 

requirements both for property address, provided in 

§ 1003.4(a)(9)(i), and property location, provided in 

§ 1003.4(a)(9)(ii). 

31 12 CFR 1003.3(c)(9). 

Federal agencies, including the Board.23

The term ‘‘consumer financial 

protection function’’ includes ‘‘all 

authority to prescribe rules or issue 

orders or guidelines pursuant to any 

Federal consumer financial law, 

including performing appropriate 

functions to promulgate and review 

such rules, orders, and guidelines.’’ 24

The Dodd-Frank Act authorizes the 

Bureau’s Director to prescribe rules ‘‘as 

may be necessary or appropriate to 

enable the Bureau to administer and 

carry out the purposes and objectives of 

the Federal consumer financial laws, 

and to prevent evasions thereof.’’ 25

HMDA is an ‘‘enumerated consumer 

law’’ and therefore a ‘‘Federal consumer 

financial law.’’ 26 Accordingly, the 

Bureau has authority to issue 

regulations to administer HMDA under 

both HMDA and the Dodd-Frank Act. 

IV. Permissible Optional Reporting 

Section 104(a) of the Act provides that 

the requirements of HMDA section 

304(b)(5) and (6) shall not apply to 

closed-end mortgage loans of an insured 

depository institution or insured credit 

union if the institution originated fewer 

than 500 closed-end mortgage loans in 

each of the two preceding calendar 

years, and it includes a similar partial 

exemption with respect to open-end 

lines of credit.27 Whether a partial 

exemption applies to an institution’s 

lending activity for a particular calendar 

year depends on an institution’s 

origination activity in each of the 

preceding two years and, in some cases, 

cannot be determined until just before 

data collection must begin for that 

particular calendar year. For example, 

whether a partial exemption applies to 

closed-end loans for which final action 

is taken in 2019 depends on the number 

of closed-end loans originated by the 

insured depository institution or 

insured credit union in 2017 and 2018. 

Thus, an insured depository institution 

or insured credit union might not know 

until the end of 2018 what information 

it needs to collect in 2019 and report in 

2020. Some insured depository 

institutions and insured credit unions 

eligible for a partial exemption under 

the Act may therefore find it less 

burdensome to report all of the data 

including the exempt data points than 

to separate the exempt data points from 

the required data points and exclude the 

exempt data points from their 

submissions. This may be particularly 

true with respect to data submission in 

2019, as collection of 2018 data was 

already underway when the Act took 

effect, and system changes 

implementing the new partial 

exemptions may take time to 

complete.28 Even after insured 

depository institutions and insured 

credit unions have had time to adjust 

their systems, some may still find it less 

burdensome to report data covered by a 

partial exemption, especially if their 

loan volumes tend to fluctuate above or 

below the threshold from year to year. 

The Bureau believes that section 104(a) 

is best interpreted as permitting 

optional reporting of data covered by 

the Act’s partial exemptions. Section 

104(a) provides that certain 

requirements do not apply to affected 

institutions but does not prohibit those 

affected institutions from voluntarily 

reporting data. This interpretation is 

consistent not only with the statutory 

text but also with the apparent 

congressional intent to reduce burden 

on certain institutions. Accordingly, the 

Bureau interprets the Act to permit 

insured depository institutions and 

insured credit unions voluntarily to 

report data that are covered by the Act’s 

partial exemptions. 

Aspects of the Bureau’s HMDA 

platform used for receiving HMDA 

submissions, including edit checks 29

performed on incoming submissions, 

are set up with the expectation that 

HMDA reporters will provide data for 

an entire data point when data are 

reported for any data field within that 

data point. Adjusting the HMDA 

platform to accept submissions for 2018 

and all future submissions in which 

affected institutions report some, but 

not all, data fields in a data point 

covered by a partial exemption for a 

specific transaction would increase 

operational complexity and costs 

associated with changing the HMDA 

edits in the Filing Instructions Guide for 

HMDA Data Collected in 2018 (2018 

FIG). Doing so would result in a less 

efficient implementation and 

submission process for the Bureau, 

HMDA reporters, their vendors, and 

other key stakeholders. Accordingly, the 

HMDA platform will continue to accept 

submissions of a data field that is 

covered by a partial exemption under 

the Act for a specific loan or application 

as long as those insured depository 

institutions and insured credit unions 

that choose to voluntarily report the 

data include all other data fields that the 

data point comprises. For example, if a 

partially exempt institution reports a 

data field that is part of the property 

address data point (such as street 

address) for a partially exempt loan or 

application, it will report all other data 

fields that are part of the property 

address data point (including zip code, 

city, and State 30) for that transaction in 

accordance with the 2018 FIG. 

V. Loans Counted Toward Partial 

Exemptions’ Thresholds 

Section 104(a) of the Act does not 

define the term ‘‘closed-end mortgage 

loan’’ or ‘‘open-end line of credit.’’ It 

also does not specify whether these 

terms include loans or lines of credit 

that would otherwise not be subject to 

HMDA reporting under Regulation C, 

such as loans used primarily for 

agricultural purposes.31 The Bureau 

believes that the terms ‘‘closed-end 


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45328 Federal Register / Vol. 83, No. 174 / Friday, September 7, 2018 / Rules and Regulations 

32The definition of ‘‘depository financial 

institution’’ in § 1003.2(g)(1)(v) is currently limited 

to institutions that either (1) originated in each of 

the preceding two years at least 25 closed-end 

mortgage loans that are not excluded from 

Regulation C pursuant to § 1003.3(c)(1) through (10) 

or (13); or (2) originated in each of the two 

preceding calendar years at least 500 open-end lines 

of credit that are not excluded from Regulation C 

pursuant to § 1003.3(c)(1) through (10). See also 12 

CFR 1003.3(c)(11), (12) (excluding closed-end 

mortgage loans from the requirements of Regulation 

C if the financial institution originated fewer than 

25 closed-end mortgage loans in either of the two 

preceding calendar years, and excluding open-end 

lines of credit from the requirements of Regulation 

C if the financial institution originated fewer than 

500 open-end lines of credit in either of the two 

preceding calendar years). As noted above, the 

threshold of 500 open-end lines of credit for the 

complete regulatory exclusion is temporary, and 

absent further Bureau action the permanent 

threshold for the Bureau’s complete regulatory 

exclusion will be 100 open-end lines of credit 

beginning January 1, 2020. While the temporary 

Regulation C threshold is in place, all of the openend lines of credit that would be covered by the 

Act’s partial exemption for open-end lines of credit 

in HMDA section 304(i)(2) are excluded from the 

requirements of part 1003 under current 

§§ 1003.2(g)(1)(v) and 1003.3(c)(12). 

33HMDA section 304(b)(5) requires disclosure of 

the number and dollar amount of mortgage loans 

grouped according to measurements of: 

• The total points and fees payable at origination; 

• The difference between the APR associated 

with the loan and a benchmark rate or rates for all 

loans; 

• The term in months of any prepayment penalty 

or other fee or charge payable on repayment of some 

portion of principal or the entire principal in 

advance of scheduled payments; and 

• Such other information as the Bureau may 

require. 

HMDA section 304(b)(6) requires disclosure of 

the number and dollar amount of mortgage loans 

and completed applications grouped according to 

measurements of: 

• The value of the real property pledged or 

proposed to be pledged as collateral; 

• The actual or proposed term in months of any 

introductory period after which the rate of interest 

may change; 

• The presence of contractual terms or proposed 

contractual terms that would allow the mortgagor 

or applicant to make payments other than fully 

amortizing payments during any portion of the loan 

term; 

• The actual or proposed term in months of the 

mortgage loan; 

• The channel through which application was 

made; 

• As the Bureau may determine to be 

appropriate, a unique identifier that identifies the 

loan originator as set forth in section 5102 of this 

title; 

• As the Bureau may determine to be 

appropriate, a universal loan identifier; 

• As the Bureau may determine to be 

appropriate, the parcel number that corresponds to 

the real property pledged or proposed to be pledged 

as collateral; 

• The credit score of mortgage applicants and 

mortgagors; and 

• Such other information as the Bureau may 

require. 

34Prior to the passage of the Dodd-Frank Act, the 

Board required financial institutions to report rate 

spread for higher-priced mortgage loans. 67 FR 7222 

(Feb. 15, 2002); 67 FR 43218 (June 27, 2002). In 

doing so, the Board noted that ‘‘the collection of 

loan pricing information is necessary to fulfill the 

statutory purposes of HMDA and to ensure the 

continued utility of the HMDA data.’’ 67 FR 7222, 

7228 (Feb. 15, 2002). The Bureau may propose in 

a future notice-and-comment rulemaking to use its 

HMDA authority other than HMDA section 

304(b)(5) and (6) to reinstate the Board’s 

requirement to report rate spread for higher-priced 

mortgage loans covered by the partial exemptions 

so the Bureau can receive data and views bearing 

on the costs and benefits of such a proposal. As 

explained in part IV above, insured depository 

institutions and insured credit unions may 

voluntarily report rate spread for transactions 

covered by the Act’s partial exemptions. 

35 12 CFR 1003.4(a)(1)(i), (a)(9)(i), and (a)(12), 

(15), (17), (22), (25), (26), (27), (28), (33), (34). 

mortgage loan’’ and ‘‘open-end line of 

credit’’ as used in the Act are best 

interpreted to include only those closedend mortgage loans and open-end lines 

of credit that would otherwise be 

reportable under HMDA. This 

interpretation is consistent with how 

loans and lines of credit are counted for 

purposes of the thresholds in Regulation 

C’s existing complete regulatory 

exclusions, which are independent of 

the Act’s new partial exemptions and 

unaffected by the Act.32 Accordingly, 

the Bureau interprets the term ‘‘closedend mortgage loan’’ to include any 

closed-end mortgage loan as defined in 

§ 1003.2(d) that is not excluded from 

Regulation C pursuant to § 1003.3(c)(1) 

through (10) or (13) and interprets the 

term ‘‘open-end line of credit’’ to 

include any open-end line of credit as 

defined in § 1003.2(o) that is not 

excluded from Regulation C pursuant to 

§ 1003.3(c)(1) through (10). 

VI. Data Points Covered by the Partial 

Exemptions 

If a transaction qualifies for one of the 

Act’s partial exemptions, section 104(a) 

of the Act provides that the 

requirements of HMDA section 304(b)(5) 

and (6) shall not apply. For the reasons 

explained below, the Bureau interprets 

the requirements of HMDA section 

304(b)(5) and (6) to include the 26 data 

points listed in the first column of table 

1 at the end of this part VI. For loans 

or applications covered by a partial 

exemption, insured depository 

institutions and insured credit unions 

therefore are required to collect and 

report only the remaining 22 data points 

specified in the 2015 and 2017 HMDA 

Final Rules, which are identified in the 

second column of table 1 below. 

As explained in part II.B above, the 

Dodd-Frank Act added HMDA section 

304(b)(5) and (6), which requires certain 

data points and provides the Bureau 

discretion to require additional data 

points.33 In the 2015 HMDA Final Rule, 

the Bureau implemented the new data 

points specified in the Dodd-Frank Act 

(including those added in new HMDA 

section 304(b)(5) and (6)), added a 

number of additional data points 

pursuant to the Bureau’s discretionary 

authority, and made revisions to certain 

pre-existing data points to clarify the 

requirements, provide greater specificity 

in reporting, and align certain data 

points more closely with industry data 

standards. 

For purposes of the Act, the Bureau 

interprets the requirements of HMDA 

section 304(b)(5) and (6) to include the 

12 data points that the Bureau added to 

Regulation C in the 2015 HMDA Final 

Rule to implement data points 

specifically identified in HMDA section 

304(b)(5)(A) through (C) or (b)(6)(A) 

through (I), which are the following: 

ULI; property address; rate spread 34; 

credit score; total loan costs or total 

points and fees; prepayment penalty 

term; loan term; introductory rate 

period; non-amortizing features; 

property value; application channel; 

and mortgage loan originator 

identifier.35 The Bureau also interprets 

the requirements of HMDA section 

304(b)(5) and (6) to include the 14 data 

points that were not found in Regulation 

C prior to the Dodd-Frank Act and that 

the Bureau required in the 2015 HMDA 

Final Rule citing its discretionary 

authority under HMDA section 

304(b)(5)(D) and (b)(6)(J). Specifically, 

these data points are the following: the 

total origination charges associated with 

the loan; the total points paid to the 

lender to reduce the interest rate of the 

loan (discount points); the amount of 

lender credits; the interest rate 

applicable at closing or account 

opening; the debt-to-income ratio; the 

ratio of the total amount of debt secured 

by the property to the value of the 

property (combined loan-to-value ratio); 

for transactions involving manufactured 

homes, whether the loan or application 

is or would have been secured by a 

manufactured home and land or by a 

manufactured home and not land 

(manufactured home secured property 

type); the land property interest for 

loans or applications related to 

manufactured housing (manufactured 

home land property interest); the 

number of individual dwellings units 

that are income-restricted pursuant to 

Federal, State, or local affordable 

housing programs (multifamily 

affordable units); information related to 

the automated underwriting system 

used in evaluating an application and 

the result generated by the automated 

underwriting system; whether the loan 

is a reverse mortgage; whether the loan 

is an open-end line of credit; whether 

the loan is primarily for a business or 

commercial purpose; and the reasons for 


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Federal Register / Vol. 83, No. 174 / Friday, September 7, 2018 / Rules and Regulations 45329 

36 12 CFR 1003.4(a)(16), (18), (19), (20), (21), (23), 

(24), (29), (30), (32), (35), (36), (37), (38). 

37Certain financial institutions supervised by the 

OCC and the FDIC are required by those agencies 

to report reasons for denial on their HMDA loan/ 

application registers. 12 CFR 27.3(a)(1)(i), 128.6, 

390.147. 

38 12 CFR 1003.4(a)(5), (13), (14), (31). 

39The 2015 HMDA Final Rule extends the 

requirement to report lien status to purchased loans 

and no longer requires reporting of information 

about unsecured loans. 80 FR 66128, 66201 (Oct. 

28, 2015). 

40Prior to 2018, Regulation C required reporting 

of property type as one-to-four family dwelling 

(other than manufactured housing), manufactured 

housing, or multifamily dwelling, whereas the 

current rule requires reporting of whether the 

dwelling is site-built or manufactured home, 

together with the number of individual dwelling 

units. 

41 80 FR 66128, 66180–81, 66199–201, 66227 

(Oct. 28, 2015). 

42See, e.g., 164 Cong. Rec. S1423–24 (daily ed. 

Mar. 7, 2018) (statement of Sen. Crapo), S1529–30 

(statement of Sen. McConnell), S1532–33 (statement 

of Sen. Cornyn), S.1537–39 (statement of Sen. 

Lankford), S1619–20 (statement of Sen. Cornyn). 

43 12 CFR 1003.4(a)(1)(ii), (a)(2), (3), (4), (6), (7), 

(8), (a)(9)(ii), (a)(10), (11), 1003.5(a)(3). 

44 Dodd-Frank Act section 1094(3)(A)(i). 

45 12 CFR 1003.4(a)(14), 1003.5(a)(3). 

denial of a loan application, which were 

optionally reported under the Board’s 

rule but became mandatory in the 2015 

HMDA Final Rule.36 Pursuant to the 

Act, insured depository institutions and 

insured credit unions need not collect 

or report these 26 data points for 

transactions that qualify for a partial 

exemption under the Act, unless 

otherwise required by their regulator.37

The Bureau interprets the 

requirements of HMDA section 304(b)(5) 

and (6) not to include four other data 

points that are similar or identical to 

data points added to Regulation C by the 

Board and that the Bureau re-adopted in 

the 2015 HMDA Final Rule: lien status 

of the subject property; whether the loan 

is subject to the Home Ownership and 

Equity Protection Act of 1994 (HOEPA); 

construction method for the dwelling 

related to the subject property; and the 

total number of individual dwelling 

units contained in the dwelling related 

to the loan (number of units).38 The 

2015 HMDA Final Rule did not alter the 

pre-existing Regulation C HOEPA status 

and lien status data requirements.39

Construction method and total units, 

together, replaced property type, the 

pre-existing Regulation C data point; the 

information required by the new data 

points is very similar to what the Board 

required, but institutions now must 

report the precise number of units rather 

than categorizing dwellings into one-tofour family dwellings and multifamily 

dwellings.40

The Board adopted its versions of 

these data points before HMDA section 

304(b)(5) and (6) was added to HMDA 

by the Dodd-Frank Act, pursuant to 

HMDA authority that pre-existed 

section 304(b)(5) and (6). Although the 

Bureau cited HMDA section 304(b)(5) 

and (6) as additional support for these 

four data points in the 2015 HMDA 

Final Rule, the Bureau relied on HMDA 

section 305(a), which pre-existed the 

Dodd-Frank Act and independently 

provides legal authority for their 

adoption.41 Given that these data points 

were not newly added by the DoddFrank Act or the Bureau, the Bureau 

does not interpret the Act as affecting 

them. This interpretation is consistent 

with the Act’s legislative history, which 

suggests that Congress was focused on 

relieving regulatory burden associated 

with the Dodd-Frank Act.42

The requirements of HMDA section 

304(b)(5) and (6), and thus the partial 

exemptions, also do not include 17 

other data points included in the 2015 

HMDA Final Rule that are similar or 

identical to pre-existing Regulation C 

data points established by the Board and 

that were not required by HMDA section 

304(b)(5) and (6) or promulgated using 

discretionary authority under HMDA 

section 304(b)(5)(D) and (b)(6)(J). These 

are: the Legal Entity Identifier (which 

replaced the pre-existing respondent 

identifier); application date; loan type; 

loan purpose; preapproval; occupancy 

type; loan amount; action taken; action 

taken date; State; county; census tract; 

ethnicity; race; sex; income; and type of 

purchaser.43 Additionally, the 

requirements of HMDA section 304(b)(5) 

and (6), and thus the partial exemptions, 

do not include age because the DoddFrank Act added that requirement 

instead to HMDA section 304(b)(4).44

With respect to transactions covered 

by one of the Act’s new partial 

exemptions, insured depository 

institutions and insured credit unions 

are therefore required to report 22 of the 

48 data points currently set forth in 

Regulation C, as indicated in table 1 

below. Because the Act does not make 

any changes with respect to these 22 

data points, insured depository 

institutions and insured credit unions 

that are eligible for a partial exemption 

under the Act must continue to report 

these 22 data points in the manner 

currently specified in Regulation C. For 

example, insured depository institutions 

and insured credit unions that are 

eligible for a partial exemption under 

the Act are still required to report a 

Legal Entity Identifier as well as lien 

status for purchased loans.45

TABLE 1—EFFECT OF THE ACT’S PARTIAL EXEMPTIONS ON HMDA DATA POINTS

Covered by the Act’s partial exemptions Unchanged by the Act 

• Universal Loan Identifier (ULI) (1003.4(a)(1)(i)) 46 ...................................................................... • Application Date (1003.4(a)(1)(ii)). 

• Property Address (1003.4(a)(9)(i)) .............................................................................................. • Loan Type (1003.4(a)(2)). 

• Rate Spread (1003.4(a)(12)) ....................................................................................................... • Loan Purpose (1003.4(a)(3)). 

• Credit Score (1003.4(a)(15)) ....................................................................................................... • Preapproval (1003.4(a)(4)). 

• Reasons for Denial (1003.4(a)(16)) ............................................................................................ • Construction Method (1003.4(a)(5)). 

• Total Loan Costs or Total Points and Fees (1003.4(a)(17)) ....................................................... • Occupancy Type (1003.4(a)(6)). 

• Origination Charges (1003.4(a)(18)) ........................................................................................... • Loan Amount (1003.4(a)(7)). 

• Discount Points (1003.4(a)(19)) .................................................................................................. • Action Taken (1003.4(a)(8)(i)). 

• Lender Credits (1003.4(a)(20)) .................................................................................................... • Action Taken Date (1003.4(a)(8)(ii)). 

• Interest Rate (1003.4(a)(21)) ....................................................................................................... • State (1003.4(a)(9)(ii)(A)). 

• Prepayment Penalty Term (1003.4(a)(22)) ................................................................................. • County (1003.4(a)(9)(ii)(B)). 

• Debt-to-Income Ratio (1003.4(a)(23)) ......................................................................................... • Census Tract (1003.4(a)(9)(ii)(C)). 

• Combined Loan-to-Value Ratio (1003.4(a)(24)) .......................................................................... • Ethnicity (1003.4(a)(10)(i)). 

• Loan Term (1003.4(a)(25)) .......................................................................................................... • Race (1003.4(a)(10)(i)). 

• Introductory Rate Period (1003.4(a)(26)) .................................................................................... • Sex (1003.4(a)(10)(i)). 

• Non-Amortizing Features (1003.4(a)(27)) ................................................................................... • Age (1003.4(a)(10)(ii)). 

• Property Value (1003.4(a)(28)) ................................................................................................... • Income (1003.4(a)(10)(iii)). 

• Manufactured Home Secured Property Type (1003.4(a)(29)) .................................................... • Type of Purchaser (1003.4(a)(11)). 

• Manufactured Home Land Property Interest (1003.4(a)(30)) ..................................................... • HOEPA Status (1003.4(a)(13)). 

• Multifamily Affordable Units (1003.4(a)(32)) ............................................................................... • Lien Status (1003.4(a)(14)). 


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45330 Federal Register / Vol. 83, No. 174 / Friday, September 7, 2018 / Rules and Regulations 

46See infra part VII (Non-Universal Loan 

Identifier). 

47 80 FR 66128, 66176 (Oct. 28, 2015). 

48HMDA requires that covered loans and 

applications be ‘‘itemized in order to clearly and 

conspicuously disclose’’ the applicable data for 

each loan or application. 12 U.S.C. 2803(a)(2). 

49Additionally, if a financial institution that is 

subject to HMDA and not eligible for a partial 

exemption purchases a loan originated by a 

partially exempt institution that assigned a nonuniversal loan identifier rather than a ULI, the 

purchasing institution does not report the nonuniversal loan identifier previously assigned. 

Instead, the purchasing institution assigns its own 

ULI because no ULI was assigned by the institution 

that originated the loan. See comment 4(a)(1)(i)–3. 

50A check digit is not required as part of a nonuniversal loan identifier, as it is for a ULI under 12 

CFR 1003.4(a)(1)(i)(C), but may be voluntarily 

included in a non-universal loan identifier 

provided that the non-universal loan identifier, 

including the check digit, does not exceed 22 

characters. 

51For example, if an insured depository 

institution or insured credit union reports a denied 

application in its annual 2020 data submission, 

pursuant to § 1003.5(a)(1), but then reconsiders the 

application, resulting in an origination in 2021, the 

institution reports a denied application under the 

original non-universal loan identifier in its annual 

2020 data submission and an origination with a 

different non-universal loan identifier in its annual 

2021 data submission, pursuant to § 1003.5(a)(1). 

TABLE 1—EFFECT OF THE ACT’S PARTIAL EXEMPTIONS ON HMDA DATA POINTS—Continued 

Covered by the Act’s partial exemptions Unchanged by the Act 

• Application Channel (1003.4(a)(33)) ........................................................................................... • Number of Units (1003.4(a)(31)). 

• Mortgage Loan Originator Identifier (1003.4(a)(34)) ................................................................... • Legal Entity Identifier (1003.5(a)(3)). 

• Automated Underwriting System (1003.4(a)(35)).

• Reverse Mortgage Flag (1003.4(a)(36)).

• Open-End Line of Credit Flag (1003.4(a)(37)).

• Business or Commercial Purpose Flag (1003.4(a)(38)).

VII. Non-Universal Loan Identifier 

In the 2015 HMDA Final Rule, the 

Bureau interpreted ‘‘universal loan 

identifier’’ (ULI) as used in HMDA 

section 304(b)(6)(G) to mean an 

identifier that is unique within the 

industry and required that the ULI 

include the Legal Entity Identifier of the 

institution that assigned the ULI.47 As 

explained in part VI above, insured 

depository institutions and insured 

credit unions are not required to report 

a ULI for loans or applications that are 

partially exempt. Some insured 

depository institutions and insured 

credit unions may prefer to report a ULI 

for partially exempt loans or 

applications even if they are not 

required to do so. As explained in part 

IV above, voluntary reporting of ULIs for 

partially exempt loans and applications 

is permissible under the Act. 

Regardless, as was true prior to the 

Dodd-Frank Act HMDA amendments 

and under Regulation C as it existed 

prior to the 2015 HMDA Final Rule, 

loans and applications must be 

identifiable in the HMDA data to ensure 

proper HMDA submission, processing, 

and compliance.48 The Bureau does not 

interpret the Act to change this baseline 

component of data collection and 

reporting. Accordingly, while insured 

depository institutions and insured 

credit unions that are eligible for partial 

exemptions under the Act do not have 

to report a ULI for partially exempt 

transactions, they must continue to 

provide information so that each loan 

and application they report for HMDA 

purposes is identifiable. The ability to 

identify individual loans and 

applications is necessary to facilitate 

efficient and orderly submission of 

HMDA data and communications 

between the institution, the Bureau, and 

other applicable regulators. For 

example, identification of loans and 

applications is necessary to ensure that 

it is possible to address problems 

identified when edit checks are done 

upon submission or questions that arise 

at a later time as HMDA submissions are 

reviewed by regulators. To ensure the 

orderly administration of the HMDA 

program, insured depository institutions 

and insured credit unions must provide 

a non-universal loan identifier that 

complies with the requirements 

identified below for any partially 

exempt loan or application for which 

they do not report a ULI. 

A non-universal loan identifier does 

not need to be unique within the 

industry and therefore does not need to 

include a Legal Entity Identifier as the 

ULI does.49 The non-universal loan 

identifier may be composed of up to 22 

characters to identify the covered loan 

or application, which: 

1. May be letters, numerals, or a 

combination of letters and numerals; 

2. Must be unique within the insured 

depository institution or insured credit 

union; and 

3. Must not include any information 

that could be used to directly identify 

the applicant or borrower.50

Information that could be used to 

directly identify the applicant or 

borrower includes, but is not limited to, 

the applicant’s or borrower’s name, date 

of birth, Social Security number, official 

government-issued driver’s license or 

identification number, alien registration 

number, government passport number, 

or employer or taxpayer identification 

number. 

To ensure that a non-universal loan 

identifier is unique within the insured 

depository institution or insured credit 

union, the institution must assign only 

one non-universal loan identifier to any 

particular covered loan or application, 

and each non-universal loan identifier 

must correspond to a single application 

and ensuing loan in the case that the 

application is approved and a loan is 

originated. Similarly, refinancings or 

applications for refinancing should be 

assigned a different non-universal loan 

identifier than the loan that is being 

refinanced. An insured depository 

institution or insured credit union with 

multiple branches must ensure that its 

branches do not use the same nonuniversal loan identifier to refer to 

multiple covered loans or applications. 

An institution may not use a nonuniversal loan identifier previously 

reported if the institution reinstates or 

reconsiders an application that was 

reported in a prior calendar year.51

VIII. Exception Based on Community 

Reinvestment Act Exam Reports 

Notwithstanding the new partial 

exemptions, new HMDA section 

304(i)(3) provides that an insured 

depository institution must comply with 

HMDA section 304(b)(5) and (6) if it has 

received a rating of ‘‘needs to improve 

record of meeting community credit 

needs’’ during each of its two most 

recent Community Reinvestment Act 

(CRA) examinations or a rating of 

‘‘substantial noncompliance in meeting 

community credit needs’’ on its most 

recent CRA examination. The Act does 

not specify as of what date an insured 

depository institution’s two most recent 

CRA examinations must be assessed for 

purposes of this exception. The Bureau 

interprets the Act to require that this 

assessment be made as of December 31 

of the preceding calendar year. This is 

consistent with Regulation C’s asset-size 

threshold and requirement that a 

financial institution have a home or 

branch office located in a Metropolitan 


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Federal Register / Vol. 83, No. 174 / Friday, September 7, 2018 / Rules and Regulations 45331 

52 12 CFR 1003.2(g)(1)(i)–(ii), 1003.2(g)(2)(i), 

comment 2(g)–1. 

53 12 U.S.C. 2906(b)(2). 

54 5 U.S.C. 553(d). 

55To generate this estimate, the Bureau first 

identified all depository institutions (including 

credit unions) that met all reporting requirements 

and reported 2017 HMDA data in 2018. From this 

set of depository institutions, the Bureau then 

excluded all depository institutions that do not 

have to report 2018 HMDA data in 2019 because 

they originated fewer than 25 closed-end mortgage 

loans in either 2016 or 2017. Of the remaining 

depository institutions, approximately 3,300 

originated fewer than 500 closed-end mortgage 

loans in each of 2016 and 2017. For purposes of this 

estimate, the Bureau assumes that these institutions 

are insured and do not have a negative CRA 

examination history and are partially exempt. 

Statistical Area, which are both assessed 

as of the preceding December 31.52

For example, in 2020, the preceding 

December 31 is December 31, 2019. 

Assume Insured Depository Institution 

A received a rating of ‘‘needs to improve 

record of meeting community credit 

needs’’ during each of its two most 

recent examinations under section 

807(b)(2) of the CRA 53 that occurred on 

or before December 31, 2019. 

Accordingly, in 2020, Insured 

Depository Institution A is not eligible 

for the Act’s partial exemptions. 

IX. Effective Date 

Because this rule is solely interpretive 

and procedural, it is not subject to the 

30-day delayed effective date for 

substantive rules under section 553(d) 

of the Administrative Procedure Act.54

The Bureau also believes that this rule 

meets the requirements for the section 

553(d)(3) exception for good cause. As 

noted above, the Bureau believes that 

the best interpretation of the Act is that 

section 104(a) took effect when the Act 

became law on May 24, 2018. Because 

of HMDA’s ongoing collection and 

reporting requirements, the impact of 

the Act on the collection and reporting 

of data for transactions with final action 

in 2018, and the related questions raised 

by financial institutions, there is good 

cause to implement and clarify section 

104(a) of the Act without delay. The 

Bureau therefore finds that there is good 

cause to make this rule effective on 

September 7, 2018. 

X. Dodd-Frank Act Section 1022(b) 

Analysis 

Section 1022(b)(2)(A) of the DoddFrank Act calls for the Bureau to 

consider the potential benefits and costs 

of a regulation to consumers and 

covered persons, including the potential 

reduction of access by consumers to 

consumer financial products or services; 

the impact on depository institutions 

and credit unions with $10 billion or 

less in total assets as described in 

section 1026 of the Dodd-Frank Act; and 

the impact on consumers in rural areas. 

Section 1022(b)(2)(B) directs the Bureau 

to consult with the appropriate 

prudential regulators or other Federal 

agencies regarding consistency with 

objectives those agencies administer. 

The manner and extent to which these 

provisions apply to a rulemaking of this 

kind, which interprets and provides 

guidance regarding existing law and 

establishes Bureau procedures but does 

not establish standards of conduct, is 

unclear. Nevertheless, to inform this 

rulemaking more fully, the Bureau 

performed the analyses and 

consultations described in those 

provisions of the Dodd-Frank Act. 

A. Overview 

Section 104(a) of the Act amends 

HMDA section 304(i) by adding partial 

exemptions from HMDA’s requirements 

for certain institutions. This interpretive 

and procedural rule implements the 

requirements of section 104(a). The rule 

provides clarification and guidance to 

all affected entities on the institutions 

covered by the partial exemption and 

what data must be collected, recorded, 

and reported. 

The rule provides clarification and 

guidance on five general items: 

1. Partially exempt institutions have 

the option to report data points covered 

by the partial exemption. If a data point 

covered by the partial exemption 

includes multiple data fields, partially 

exempt institutions report all of the data 

fields if they choose to report at least 

one of the data fields. 

2. The terms ‘‘closed-end mortgage 

loan’’ and ‘‘open-end line of credit’’ 

include only loans and lines of credit 

that are otherwise reportable under 

HMDA. 

3. Partially exempt institutions are not 

required to report 26 data points 

specified in this rule. 

4. Partially exempt institutions are 

required to report a non-universal loan 

identifier if they choose not to report a 

ULI. 

5. For a given reporting year, the CRA 

ratings used to determine whether the 

CRA reporting exception applies are the 

two most recent CRA ratings as of 

December 31 of the preceding calendar 

year. 

In developing this rule, the Bureau 

has considered potential benefits, costs, 

and impacts of these clarifications and 

guidance. The Bureau has consulted 

with, or offered to consult with, the 

Board, the Federal Deposit Insurance 

Corporation, the Office of the 

Comptroller of the Currency, the 

National Credit Union Administration, 

the Department of Housing and Urban 

Development, the Securities and 

Exchange Commission, the Department 

of Justice, the Department of Veterans 

Affairs, the Federal Housing Finance 

Agency, the Department of the Treasury, 

the Department of Agriculture, the 

Federal Trade Commission, and the 

Federal Financial Institutions 

Examination Council. 

B. Institutions Affected by Rule or Act 

Under section 104(a) of the Act, an 

insured depository institution or 

insured credit union is eligible for a 

partial exemption for its closed-end 

mortgage loans if it originated fewer 

than 500 closed-end mortgage loans in 

each of the two preceding calendar 

years and did not receive a rating of 

‘‘needs to improve record of meeting 

community credit needs’’ during both of 

its two most recent CRA examinations 

or a rating of ‘‘substantial 

noncompliance in meeting community 

credit needs’’ during its most recent 

CRA examination. After applying all 

current HMDA reporting requirements, 

including Regulation C’s complete 

regulatory exclusion for institutions that 

originated fewer than 25 closed-end 

mortgage loans in either of the two 

preceding calendar years, the Bureau 

estimates that section 104(a) of the Act 

provides a partial exemption with 

respect to collection, recording, and 

reporting of 2018 HMDA data to 

approximately 3,300 institutions.55 As a 

point of reference, 5,852 institutions 

reported data under HMDA in 2018. 

For open-end lines of credit, the 

Bureau estimates that the new reporting 

criteria in section 104(a) of the Act will 

not have any effect on data collected in 

2018. Regulation C currently provides a 

complete regulatory exclusion for openend lines of credit for institutions that 

originated fewer than 500 open-end 

lines of credit in either of the preceding 

two years, and this exclusion applies to 

more institutions than the section 104(a) 

partial exemption criterion of fewer 

than 500 originations in each of the two 

preceding calendar years. The effect that 

section 104(a) will have on data 

collected for open-end lines of credit on 

or after January 1, 2020, is unclear 

because the temporary threshold of 500 

open-end lines of credit for the 

complete regulatory exclusion applies 

only for 2018 and 2019. The Bureau has 

indicated that it intends to reconsider 

the threshold for the permanent 

regulatory exclusion for open-end lines 

of credit, which is currently set at 100 


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45332 Federal Register / Vol. 83, No. 174 / Friday, September 7, 2018 / Rules and Regulations 

56 82 FR 43088 (Sept. 13, 2017). 57The Bureau has discretion in any rulemaking 

to choose an appropriate scope of analysis with 

respect to potential benefits, costs, and impacts and 

an appropriate baseline. As noted earlier, the 

Bureau anticipates an upcoming notice-andcomment rulemaking and expects that the 

accompanying 1022(b) analysis will assess the 

benefits, costs, and impacts of the statute as well 

as the implementing regulation. 

open-end lines of credit starting in 

2020.56

C. Potential Benefits and Costs to 

Consumers and Covered Persons 

The Bureau is using a post-statute 

baseline to assess the impact of this rule 

because the rule merely interprets and 

provides guidance regarding what 

Congress required in section 104(a) of 

the Act and provides procedures related 

to applying those requirements.57 It 

does not impose new, or change 

existing, substantive requirements that 

would require exercise of the Bureau’s 

legislative rulemaking authority. Using a 

post-statute baseline, the analysis 

evaluates the benefits, costs, and 

impacts of the rule as compared to the 

state of the world if the proposed 

interpretive and procedural rule were 

not adopted. Without this interpretive 

and procedural rule, affected 

institutions would lack authoritative 

clarification and guidance regarding 

how to comply with certain changes to 

HMDA made by section 104(a) of the 

Act. 

Covered persons should benefit from 

this rule because it will ease review, 

understanding, and compliance with 

section 104(a) of the Act, which will in 

turn reduce the likelihood of potentially 

inconsistent or incorrect 

implementation. It is not practicable to 

quantify the precise magnitude of these 

informational benefits; however, they 

will likely vary over time, with earlier 

guidance providing higher benefits 

because covered persons have more 

time to incorporate this information into 

their planning and preparation. Without 

this rule, covered persons would either 

need to rely more heavily on their own 

independent evaluations of the statute, 

which would increase the likelihood of 

inconsistent or incorrect 

implementation and non-compliance, or 

wait for guidance in the anticipated 

notice-and-comment rulemaking, which 

would provide covered persons less 

time to incorporate authoritative 

guidance while adopting the changes 

under the Act. 

These short-run benefits of the rule 

are somewhat offset by guidance the 

Bureau provided in December 2017, 

indicating that it does not intend to 

require data resubmission of 2018 

HMDA data unless data errors are 

material or to assess penalties for data 

errors. The Board, the Office of the 

Comptroller of the Currency, the Federal 

Deposit Insurance Corporation, and the 

National Credit Union Administration 

released similar statements. Decreased 

potential for data resubmission and 

penalties in the short-run reduces the 

value to covered persons of receiving 

earlier guidance and clarification. 

An additional benefit is that this rule 

provides covered persons with 

additional options, and increased 

options generally translate into 

increased benefits. For example, the rule 

allows for voluntary reporting of 

partially exempt data points such as 

ULI. During the 2015 HMDA rulemaking 

process, however, some commenters 

suggested that options increased 

reporting burden, because they added 

uncertainty and required more 

interpretation. 

The Bureau expects this rule to 

impose negligible costs on covered 

persons. There are three items of note 

here. First, this rule provides specific 

definitions of the terms ‘‘closed-end 

mortgage loan’’ or ‘‘open-end line of 

credit,’’ which are not defined in section 

104(a) of the Act. The Bureau is 

interpreting these terms to include only 

loans and lines of credit that would 

otherwise be reportable under 

Regulation C. The Bureau believes that 

tying the definitions to the same criteria 

that already determines HMDA 

reportability will not impose any 

additional costs. By contrast, if the 

Bureau had interpreted these terms to 

have a broader meaning, the rule would 

have resulted in fewer covered persons 

being eligible for the Act’s partial 

exemptions and additional costs for 

covered persons. 

Second, requiring partially exempt 

institutions that choose not to report a 

ULI (an exempt data point) to report a 

non-universal loan identifier, consistent 

with criteria specified in the rule, could 

potentially increase burden. However, 

the Bureau believes that this burden, if 

any, will be negligible, because most 

institutions will already have a loan 

identifier for internal processing and 

tracking purposes, and, for those that do 

not, creating and reporting a loan 

identifier will be low cost. 

Third, requiring a partially exempt 

institution to report all data fields for an 

exempt data point if it voluntarily 

chooses to report at least one of the data 

fields could increase burden. In some 

circumstances, the institution could face 

increased costs in having to report all 

data fields rather than only the data 

fields it chooses to report. However, the 

Bureau believes that this additional 

burden will be small. This requirement 

will affect only partially exempt 

institutions that would prefer to 

voluntarily report some, but not all, data 

fields for a particular data point, and the 

number of such institutions is likely 

small. In addition, of the 26 exempt data 

points, only seven have multiple data 

fields (property address, credit score, 

reason for denial, total loan costs or 

total points and fees, non-amortizing 

features, application channel, and 

automated underwriting system), which 

also serves to limit the burden 

associated with this provision. 

In addition to effects on covered 

persons discussed above, this 

rulemaking is expected to have 

negligible impact on consumers, in 

terms of either costs or benefits. 

D. Impact on Depository Institutions 

With No More Than $10 Billion in 

Assets 

The Bureau estimates that 

approximately 3,300 institutions are 

partially exempt under section 104(a) of 

the Act, and that most of these 

institutions are depository institutions 

with no more than $10 billion in assets. 

The benefits of this rule to these 

institutions are summarized in part X.C. 

The Bureau expects the burden of this 

rule on these institutions to be 

negligible. 

E. Impact on Access to Credit 

The Bureau does not expect this rule 

to affect consumers’ access to credit. 

The scope of the rulemaking is limited 

to clarification of reporting 

requirements that would not be of 

sufficient magnitude to materially affect 

access to credit. 

F. Impact on Consumers in Rural Areas 

The Bureau does not believe that this 

rule will have a unique impact on 

consumers in rural areas. Any potential 

effects on consumers, expected to be 

negligible in all cases, would be indirect 

effects passed through by HMDA 

reporters, and any impact on HMDA 

reporters is not expected to vary by 

geographic area. In addition, many rural 

lenders are not required to report 

because of HMDA’s requirement that a 

financial institution have a home or 

branch office located in a Metropolitan 

Statistical Area, so the rule would have 

no specific impacts on rural areas. 

XI. Regulatory Requirements 

This rule articulates the Bureau’s 

interpretation of section 104(a) of the 

Economic Growth, Regulatory Relief, 

and Consumer Protection Act. It also 

alters the manner and procedure in 

which insured depository institutions 

and insured credit unions eligible for 


daltland on DSKBBV9HB2PROD with RULES
Federal Register / Vol. 83, No. 174 / Friday, September 7, 2018 / Rules and Regulations 45333 

58 5 U.S.C. 603(a), 604(a). 

59 5 U.S.C. 801–808. 

the Act’s new partial exemptions may 

present their data to the Bureau, but it 

does not alter those institutions’ rights 

or interests or encode substantive value 

judgments beyond furthering efficiency 

and operational goals. This interpretive 

and procedural rule is exempt from 

notice-and-comment rulemaking 

requirements under the Administrative 

Procedure Act, 5 U.S.C. 553(b). Because 

no notice of proposed rulemaking is 

required, the Regulatory Flexibility Act 

does not require an initial or final 

regulatory flexibility analysis.58

The Bureau has determined that this 

interpretive and procedural rule does 

not impose any new or revise any 

existing recordkeeping, reporting, or 

disclosure requirements on covered 

entities or members of the public that 

would be collections of information 

requiring approval by the Office of 

Management and Budget under the 

Paperwork Reduction Act, 44 U.S.C. 

3501 through 3521. To the extent that 

eligible reporters may take advantage of 

the Act’s partial exemptions, the Bureau 

lacks sufficient information at present to 

estimate the potential burden reduction. 

When the Bureau has sufficient data to 

make an estimate, it will revise its 

burden estimates as appropriate. 

XII. Congressional Review Act 

Pursuant to the Congressional Review 

Act,59 the Bureau will submit a report 

containing this interpretive rule and 

other required information to the U.S. 

Senate, the U.S. House of 

Representatives, and the Comptroller 

General of the United States prior to the 

rule’s published effective date. The 

Office of Information and Regulatory 

Affairs has designated this interpretive 

rule as not a ‘‘major rule’’ as defined by 

5 U.S.C. 804(2). 

Dated: August 30, 2018. 

Mick Mulvaney, 

Acting Director, Bureau of Consumer 

Financial Protection. 

[FR Doc. 2018–19244 Filed 9–6–18; 8:45 am] 

BILLING CODE 4810–AM–P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 39 

[Docket No. FAA–2018–0777; Product 

Identifier 2018–NE–28–AD; Amendment 39– 

19366; AD 2018–17–12] 

RIN 2120–AA64 

Airworthiness Directives; General 

Electric Company Turbofan Engines 

AGENCY: Federal Aviation 

Administration (FAA), DOT. 

ACTION: Final rule; request for 

comments. 

SUMMARY: We are adopting a new 

airworthiness directive (AD) for all 

General Electric Company (GE) GE90– 

76B, GE90–77B, GE90–85B, GE90–90B, 

and GE90–94B turbofan engines with 

full authority digital engine control 

(FADEC) software, version 9.3.2.4 or 

earlier, installed. This AD requires 

upgrading the FADEC software to a 

software version eligible for installation. 

This AD was prompted by an ice-crystal 

icing (ICI) event that caused damage to 

both engines, a single engine stall, and 

subsequent engine shutdown. We are 

issuing this AD to address the unsafe 

condition on these products. 

DATES: This AD is effective September 

24, 2018. 

We must receive comments on this 

AD by October 22, 2018. 

ADDRESSES: You may send comments, 

using the procedures found in 14 CFR 

11.43 and 11.45, by any of the following 

methods: 

• Federal eRulemaking Portal: Go to 

http://www.regulations.gov. Follow the 

instructions for submitting comments. 

• Fax: 202–493–2251. 

• Mail: U.S. Department of 

Transportation, Docket Operations, 

M–30, West Building Ground Floor, 

Room W12–140, 1200 New Jersey 

Avenue SE, Washington, DC 20590. 

• Hand Delivery: U.S. Department of 

Transportation, Docket Operations, 

M–30, West Building Ground Floor, 

Room W12–140, 1200 New Jersey 

Avenue SE, Washington, DC 20590, 

between 9 a.m. and 5 p.m., Monday 

through Friday, except Federal holidays. 

For service information identified in 

this final rule, contact General Electric 

Company, GE Aviation, Room 285, 1 

Neumann Way, Cincinnati, OH 45215; 

phone: 513–552–3272; email: 

aviation.fleetsupport@ge.com. You may 

view this service information at the 

FAA, Engine and Propeller Standards 

Branch, 1200 District Avenue, 

Burlington, MA 01803. For information 

on the availability of this material at the 

FAA, call 781–238–7759. It is also 

available on the internet at http://

www.regulations.gov by searching for 

and locating Docket No. FAA–2018– 

0777. 

Examining the AD Docket 

You may examine the AD docket on 

the internet at http://

www.regulations.gov by searching for 

and locating Docket No. FAA–2018– 

0777; or in person at Docket Operations 

between 9 a.m. and 5 p.m., Monday 

through Friday, except Federal holidays. 

The AD docket contains this final rule, 

the regulatory evaluation, any 

comments received, and other 

information. The street address for the 

Docket Operations (phone: 800–647– 

5527) is listed above. Comments will be 

available in the AD docket shortly after 

receipt. 

FOR FURTHER INFORMATION CONTACT: John 

Frost, Aerospace Engineer, ECO Branch, 

FAA, 1200 District Avenue, Burlington, 

MA 01803; phone: 781–238–7756; fax: 

781–238–7199; email: john.frost@

faa.gov. 

SUPPLEMENTARY INFORMATION: 

Discussion 

We received a report of a commanded 

in-flight shutdown and an air turn back 

shortly after takeoff. After further 

investigation, the operator found highpressure compressor (HPC) damage, 

which was the result of an earlier ICI 

event. After the ICI event and 

subsequent progressive HPC damage, 

engine performance decreased and an 

engine stall occurred. As a result, GE 

improved the FADEC software to 

provide ICI event detection and to 

provide an alternate variable bypass 

valve (VBV) schedule that opens the 

VBV doors to extract ice crystals from 

the core flowpath and reduce accretion 

when ICI is detected. This condition, if 

not addressed, could result in failure of 

the HPC, failure of one or more engines, 

loss of thrust control, and loss of the 

airplane. We are issuing this AD to 

address the unsafe condition on these 

products. 

Related Service Information 

We reviewed GE GE90 Service 

Bulletin (SB) 73–0146, dated May 2, 

2018. The SB introduces new FADEC 

software and describes procedures for 

upgrading the FADEC software. 

FAA’s Determination 

We are issuing this AD because we 

evaluated all the relevant information 

and determined the unsafe condition 

described previously is likely to exist or 


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