Lenders Worry About Accuracy in Complying with HMDA Rule

Accurately capturing mortgage data to meet new federal regulators is a top challenge for banks and credit unions, according to Wolters Kluwer Financial Services.

Last week, the Consumer Financial Protection Bureau issued its final version of the Home Mortgage Disclosure Act rule. The HMDA rule, which was mandated by Dodd-Frank, requires lenders to collect an expanded range of data from mortgage applicants and borrowers.

The new data fields required to be completed by HMDA have raised concerns among banks and credit unions, according to Wolters Kluwer's new Regulatory and Risk Management Indicator survey. Lenders are worried about accuracy and upgrading their systems to accommodate the new requirements, as well as the time and cost to train staff.

"Lenders are becoming increasingly aware — and wary — of the ramifications of the new HMDA rules, including the many levels in which it will impact their organizations, including technology, operations, staffing and regulatory change management," Timothy Burniston, executive vice president of Wolters Kluwer, said in a news release.

Wolters Kluwer sells a tool to help lenders navigate the new HMDA rule.