By Gina Ellis, CRCM
On April 4, 2017, the Consumer Financial Protection Bureau (CFPB) proposed amendments to Regulation B, the Equal Credit Opportunity Act (ECOA), to conform with the requirements for collection of race and ethnicity to those found in recent revisions to Regulation C, the Home Mortgage Disclosure Act (HMDA). The proposal would make three important changes to Regulation B as follows.
- Allow applicants to self-identify race and ethnicity by using the new disaggregated categories as outlined in HMDA. For example, if identifying under the aggregate data point as Hispanic or Latino, an applicant can also indicate one or more of the disaggregated categories, Mexican, Puerto Rican, Cuban or Other Hispanic or Latino. Lenders reporting based on visual observation or surname are restricted to reporting only the aggregated categories.
- Remove the 2004 Uniform Residential Loan Application (URLA) as a model form and instead reference the model forms used to collect government monitoring information or demographic information as outlined under HMDA.
- Allow the collection of race and ethnicity in certain circumstances, such as when a lender might not be required to collect and report HMDA data in a specific year.
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