New York Credit Union Association President/CEO William J. Mellin commented on the CFPB’s proposed clarifications to the bureau’s Home Mortgage Disclosure Act regulations, which would assist credit unions making Consolidation Extension and Modification Agreements, or CEMAs.

The bureau’s proposal has a direct impact on CEMAs, explained Mellin.

In its 2015 amendments to HMDA, the CFPB amended regulations so that CEMAs must be listed as mortgage loans. These new regulations take effect starting in 2018. The Bureau’s approach meant that both the supplemental mortgage and the consolidated mortgage would have to be registered as separate mortgages for HMDA purposes.

The comment addressed by Mellin clarifies that when an existing loan is effectively combined with a new supplemental mortgage, only the single consolidated loan that results after the loan consolidation has been completed must be reported under HMDA.

While Mellin continued to express criticism of the CFPB’s initial decision, he complimented the bureau for the proposed clarifications, which provides credit unions with needed guidance on how to treat CEMA loans under HMDA.

“Although we ultimately find ourselves disagreeing with some of the CFPB’s proposals, the Association continues to be impressed by the CFPB’s willingness to fine tune its regulations in response to operational concerns,” he wrote. “These proposed clarifications, while not ideal, will help New York credit unions comply more easily with the updated HMDA requirements.”