Fannie Mae and Freddie Mac will require mortgage servicers to obtain and maintain fair lending data on their loans, and for this data to transfer with servicing throughout the term of the mortgage, starting in March 2023.
This requirement is one of two updates the Federal Housing Finance Agency (FHFA) recently announced. In addition to transferring borrowers’ age, race, ethnicity, and gender information to servicers, lenders will also be required to use the Supplemental Consumer Information Form (SCIF), Form 1103, during the application process. Previously non-mandatory, the form contains questions about the borrowers’ preferred language; it also includes questions about whether the borrower received homeowner education and housing counseling. Response by borrowers to the preferred language question in the SCIF will remain voluntary.
“The need for collection and maintenance of quality fair lending data is a lesson learned from the foreclosure crisis and COVID-19 response,” said FHFA Director Sandra L. Thompson. “Having fair lending data travel with servicing will help servicers do the important work of providing assistance to borrowers in need, helping to further a sustainable and equitable housing finance system.”
Although FHFA will collect this information, language preference will not be reportable under the Home Mortgage Disclosure Act.