March 27, 2017
On March 24, 2017, the Consumer Financial Protection Bureau issued a proposed rule that would amend Equal Credit Opportunity Act regulations to provide creditors with additional flexibility in how they collect an applicant's ethnicity and race information. Regulation B, which implements the ECOA, prohibits a creditor from inquiring about the race, color, religion, national origin, or sex of a credit applicant except under certain circumstances. One of those circumstances is a requirement for creditors to collect and retain certain information about applicants for certain dwelling-secured loans. Another circumstance is the applicant information required to be collected and reported by financial institutions under Regulation C, which implements the Home Mortgage Disclosure Act. Regulation B also includes certain optional model forms for use in complying with certain Regulation B requirements. One of the optional model forms is a 2004 version of the Uniform Residential Loan Application ("2004 URLA") issued by Fannie Mae and Freddie Mac. In August 2016, Fannie Mae and Freddie Mac issued a revised version of the URLA.
The CFPB issued a final rule in October 2015 amending Regulation C, which included changes to the collection of applicants' ethnicity and race information ("2015 HMDA Final Rule"). The CFPB proposes to amend various sections of Regulation B to, among other things, permit creditors additional flexibility in how they collect an applicant's ethnicity and race information in order to facilitate compliance with Regulation C, as amended in the 2015 HMDA Final Rule, permit creditors to collect applicant information in certain circumstances when they would not otherwise be required to do so, and address retention of information about certain applicants. The proposed amendments to Appendix B would remove the 2004 URLA from Regulation B and add additional sample forms to Regulation B to facilitate compliance.
Comments on the proposal will be due within 30 days after it is published in the Federal Register.