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 Lenders already must report loan amounts and some information
about borrowers and their homes under a 1975 law. That data, parts
of which are made public, help regulators spot possible unfair
lending patterns.
The consumer bureau, or CFPB, wants to beef up that data so it can
see more potential problems in the markets, as well as track how its
sweeping new rules for lenders affect borrowers' ability to get
loans.
The CFPB plans to ask small businesses for feedback on what
information to collect and to ask for tips on how to make gathering
that data less onerous for small firms.
"One of the main purposes of this effort is to gain greater insight
into issues about access to credit," CFPB Director Richard Cordray
told reporters.
Congress created the consumer bureau under the 2010 Dodd-Frank
financial law and gave it oversight of mortgages after sloppy — and
sometimes fraudulent — lending practices fueled the 2007-2009
housing crisis.
After the crisis, experts said regulators often did not have enough
insight into housing markets to spot abusive practices before the
bubble burst. So lawmakers also directed the bureau to update data
reporting rules to get a better picture of current conditions.
Under the Dodd-Frank changes, lenders need to disclose the length of
loans, total fees, any teaser rates and borrowers' credit scores, in
addition to the mortgage information they already hand over.
On top of those required changes, the consumer bureau wants lenders
to share the interest rates they charge and total origination fees,
and to explain any rejected applications.
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The CFPB also wants lenders to disclose whether loans they issue are
considered "qualified mortgages."
These basic loans are carved out from some of the bureau's new rules
for mortgage lending. Some critics of the bureau have said lenders
might only issue loans that fit this definition, preventing some
worthy borrowers from getting a mortgage.
"This information would help regulators and the public determine how
the bureau's rules are affecting the mortgage market," Cordray said.
The bureau plans to run all these ideas by a small business panel
before formally proposing any changes, he said.
In order to make the new rules easier for small firms, the CFPB said
it also wants to know how it could align the new data reporting with
information banks already collect and make sure similarly sized
banks and nonbanks face the same requirements.
(Reporting by Emily Stephenson; editing by Dan Grebler)
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