although examiners have long considered institutions ’ mortgage pricing as part of the fair lending review process, public disclosure of this pricing data appears to have given additional impetus to institutions ’ compliance efforts. many institutions have reexamined their pricing policies and procedures to ensure that they do not permit, even inadvertently, pricing differences that violate the fair lending laws. many institutions have also reevaluated their controls to ensure that proper policies are followed. this increased attention by institutions to their own fair lending compliance is one of the principal benefits of hmda. research by federal reserve staff and others supervision for fair lending compliance deals with lending patterns at the institution level. but the hmda data also reveal lending patterns at aggregate levels, across institutions. disclosure of aggregate patterns can raise and focus attention on important policy questions concerning access to credit. to that end, researchers at the federal reserve have published numerous papers and articles. most recently, staff published an article about patterns in the new loan - pricing data. 1 i will review a few of their findings. first, most home lenders make few, if any, higher - priced loans. in 2004, only about 500 out of the 8, 850 reporting institutions made 100 or more higher - priced loans ; the ten lenders with the largest volume of higher - priced loans accounted for about 40 percent of all such loans. ( the ffiec has not finished reviewing, processing, and editing the 2005 data, which were submitted in march of this year. ) the 2004 data also show that 16 percent of borrowers took out higher - priced loans that year in the nation as a whole. this proportion may have increased from 2004 to 2005. for most loans, the board ’ s regulation uses long - term interest rates to set the thresholds for reporting loan - price data, but mortgage loan rates more closely track short - term rates. thus, a narrowing of the difference between short - term and long - term rates, such as occurred from 2004 to 2005, may increase the proportion of loans reported as higher - priced loans. the proportion of borrowers obtaining higher - priced loans is not geographically uniform but varies widely by region and by city. for example, in many of the metropolitan areas of the south and the southwest, 30 percent to 40 percent of homebuyers taking out conventional loans in 2004 took out higher - priced loans. in other areas of the country, the proportion was much smaller. these differences may not be that surprising - other data show that credit scores tend to

to gather information about, among other things, how consumers select their lenders and loans. the board ’ s 2007 biennial community development research conference will also provide a forum for research that may help explain differences in the incidence of higher - priced lending. robert b. avery, glenn b. canner, and robert e. cook ( 2005 ), " new information reported under hmda and its application in fair lending enforcement, " federal reserve bulletin, vol. 91 ( summer 2005 ), pp. 344 - 394. the federal reserve ’ s promotion of community development and financial literacy i have discussed the federal reserve ’ s roles in regulation, supervision, and research. now i will turn to its role in promoting community development and financial literacy. the federal reserve system uses hmda data to help banks, community organizations, and other interested groups identify community development needs and opportunities. for example, the federal reserve bank of boston tabulates hmda data for the new england region to help regional financial institutions, community organizations, and state and local governments access and use information about their area ’ s regional lending patterns. in addition, the community affairs offices of the federal reserve system encourage and facilitate collaboration among financial institutions, governments, and community organizations to improve access to mortgage credit in traditionally underserved communities. the federal reserve also promotes financial literacy. board staff provide strategic advice on developing financial literacy policies, programs, partnerships, and marketing to national initiatives, such as the jump $ tart coalition, operation hope, and the dollarwi $ e campaign of the conference of mayors. in a parallel effort, the federal reserve banks support similar regional initiatives. the federal reserve also collaborates with other groups on research to develop successful financial education programs and identify the most effective way to deliver these programs to intended audiences. by these and other means, the federal reserve seeks to address gaps in consumers ’ understanding of not only home loan transactions but also financial management more broadly. these gaps in consumer understanding may be contributing to disparities in the availability and price of home loans. in closing, i appreciate this opportunity to discuss the federal reserve ’ s regulation requiring lenders to disclose price and other data on home loans ; how the federal reserve uses the data to improve fair lending supervision ; and the federal reserve ’ s promotion of research, community development, and financial literacy.