CFPB Amends ECOA Rules on the Collection of Consumer Data

10/24/17 – In September, the Consumer Financial Protection Bureau (CFPB) modified its regulations to the Equal Credit Opportunity Act (ECOA), which will provide mortgage lenders flexibility in the collection of consumer data.

The final rule amends parts of Regulation B (the rules which implement the ECOA), its commentary, and its appendices, and affects when and how a creditor may collect information regarding the applicant’s ethnicity, race, and sex. The creditors affected by this rule are primarily those that make mortgage loans dealing with purchase and refinance transactions involving an applicant’s primary residence. Additionally, financial institutions that report under Regulation C (rules the implement the Home Mortgage Disclosure Act), have reported in the prior five years, or may soon report may also be affected by this rule. Creditors that utilize model forms from the Regulation B appendix for mortgage loans are affected by the rule, as well.

Under the new rule, mortgage lenders will not be required to maintain different practices depending on their loan volume or other characteristics, allowing more lenders to adopt application forms that include expanded requests for information regarding a consumer’s ethnicity and race, including the revised Uniform Residential Loan Application (URLA).

Some changes to Regulation B are listed below:

CFPB Press ReleaseFinal Rule Reg. B.

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