New information to report
Here's the new information the CFPB wants to collect:
- Interest rates, including teaser rates
- Origination fees
- Discount points
- Reasons behind loan rejections
- Debt-to-income ratios
- Borrower age
- Credit score
- QM or non-QM
Gary Painter, director of research at the USC Lusk Center for Real Estate in Los Angeles, says that there is always a benefit to collecting more information about important financial transactions. And few transactions are as important to the U.S. economy as are mortgage loans.
Already, Painter says, the information collected under the HMDA has provided important data to regulators on lending patterns in particular parts of the country.
Is the extra data worth the added cost?
That's a question that can only be answered after a more detailed study of the proposal, Painter says.
"The right question is, 'Do the benefits outweigh the cost of the additional reporting?'" Painter says. "I don't know the answer to that yet."
Painter also says that no matter how much new information the bureau collects, it's not reasonable to expect the new data to allow regulators to completely stamp out mortgage abuse or fraud.
"There is no one policy that can prevent all forms of discrimination or fraud," Painter says.