[Federal Register Volume 80, Number 167 (Friday, August 28, 2015)]
[Notices]
[Pages 52275-52279]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-21288]


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FEDERAL HOUSING FINANCE AGENCY

[No. 2015-N-07]


Privacy Act of 1974; System of Records

AGENCY: Federal Housing Finance Agency.

ACTION: Notice of revision to an existing system of records; request 
for comments.

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SUMMARY: In accordance with the requirements of the Privacy Act of 
1974, as amended, 5 U.S.C. 552a (Privacy Act), the Federal Housing 
Finance Agency (FHFA) is reissuing the system of records entitled 
``National Mortgage Database Project'' (FHFA-21). FHFA is re-issuing 
this notice in response to comments received on the Notice published on 
April 16, 2014 at 79 FR 21458. In reissuing this notice, FHFA requests 
further comments on the below revisions to the existing system of 
records.
    This revised system of records covers the National Mortgage 
Database Project (``Project''), which is comprised of three components: 
(1) The National Mortgage Database (``NMDB''); (2) the information used 
to create the NMDB but will not be contained within the NMDB; and (3) 
National Surveys of Mortgage Borrowers (``Surveys''). The Project is 
designed to satisfy the Congressionally-mandated requirements of 
section 1324(c) of the Federal Housing Enterprises Financial Safety and 
Soundness Act of 1992, as amended by the Housing and Economic Recovery 
Act of 2008. Under this statutory provision, FHFA must, through surveys 
of the mortgage market, collect information on the characteristics of 
individual mortgages, including those that are eligible for purchase by 
the Federal National Mortgage Association (Fannie Mae) and the Federal 
Home Loan Mortgage Corporation (Freddie Mac) as well as those that are 
not, and subprime and nontraditional mortgages, including information 
on the creditworthiness of those borrowers sufficient to determine 
whether they would have qualified for prime lending.

DATES: To be assured of consideration, comments must be received on or 
before October 27, 2015. The revisions to the existing system will 
become effective on November 6, 2015 unless comments necessitate 
otherwise. FHFA will publish a new notice if, in order to review 
comments, the effective date is delayed or if changes are made based on 
comments received.

ADDRESSES: Submit comments, identified by ``2015-N-07,'' using only one 
of the following methods:
     Agency Web site: www.fhfa.gov/open-for-comment-or-input.
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments. If you submit your 
comment to the Federal eRulemaking Portal, please also send it by email 
to FHFA at [email protected] to ensure timely receipt by FHFA. 
Please include ``2015-N-07'' in the subject line of the message.
     Hand Delivered/Courier: The hand delivery address is: 
Alfred M. Pollard, General Counsel, Attention: Comments/2015-N-07, 
Federal Housing Finance Agency, 400 Seventh Street SW., Washington, DC 
20024. To ensure timely receipt of hand delivered package, please 
ensure that the package is delivered to the Seventh Street entrance 
Guard Desk, First Floor, on business days between 9 a.m. to 5 p.m.
     U.S. Mail, United Parcel Service, Federal Express, or 
Other Mail Service: The mailing address for comments is: Alfred M. 
Pollard, General Counsel, Attention: Comments/2015-N-07, Federal 
Housing Finance Agency, 400 Seventh Street SW., Washington, DC 20024. 
Please note that all mail sent to FHFA via the U.S. Postal Service is 
routed through a national irradiation facility, a process that may 
delay

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delivery by approximately two weeks. For any time-sensitive 
correspondence, please plan accordingly.
    See SUPPLEMENTARY INFORMATION for additional information on 
submission and posting of comments.

FOR FURTHER INFORMATION CONTACT: Forrest Pafenberg, Program Manager, 
National Mortgage Database Project, [email protected] or (202) 
649-3129; Stacy Easter, Privacy Act Officer, [email protected] or (202) 
649-3803; or David A. Lee, Senior Agency Official for Privacy, 
[email protected] or (202) 649-3803 (not toll-free numbers), Federal 
Housing Finance Agency, Eighth Floor, 400 Seventh Street SW., 
Washington, DC 20024. The telephone number for the Telecommunications 
Device for the Deaf is 800-877-8339.

SUPPLEMENTARY INFORMATION: 

I. Comments

    FHFA seeks public comments on the revised system of records for the 
National Mortgage Database Project (FHFA-21) and will take all comments 
into consideration. See 5 U.S.C. 552a(e)(4) and (11). In addition to 
referencing ``Comments/2015-N-07,'' please reference ``National 
Mortgage Database Project'' (FHFA-21).
    All comments received will be posted without change on the FHFA Web 
site at http://www.fhfa.gov, and will include any personal information 
provided, such as name, address (mailing and email), and telephone 
numbers. In addition, copies of all comments received will be available 
without change for public inspection on business days between the hours 
of 10 a.m. and 3 p.m., at the Federal Housing Finance Agency, 400 
Seventh Street, SW., Washington, DC 20024. To make an appointment to 
inspect comments, please call the Office of General Counsel at (202) 
649-3804.

II. Introduction

    This revised system of records covers the National Mortgage 
Database Project (``Project''), which is comprised of three components: 
(1) The National Mortgage Database (``NMDB''); (2) the information used 
to create the NMDB but will not be contained within the NMDB; and (3) 
National Surveys of Mortgage Borrowers (``Surveys''). Each of these 
components is described below.
    The revised system of records, ``National Mortgage Database 
Project'' (FHFA-21), will contain records related to the creation of 
the NMDB. The core data for the NMDB are drawn from data maintained by 
one of the three national credit repositories as well as data to be 
drawn from: (1) Administrative data sources including existing mortgage 
data from Fannie Mae, Freddie Mac, the Federal Home Loan Banks (Banks), 
the Federal Housing Administration (FHA), the United States Department 
of Veterans Affairs (VA), and other government agencies; (2) Home 
Mortgage Disclosure Act (HMDA) data; and (3) other commercially 
available mortgage, property, and appraisal sources. Data from these 
various sources will be used to create and update the NMDB. Once the 
NMDB has been created from these sources, the input datasets will be 
permanently deleted and will not be maintained by the Project. The NMDB 
does not contain and is not a credit report or set of credit reports as 
defined under the Federal Credit Report Act, 15 U.S.C. 1681 et seq.
    Any information on borrower(s) in the NMDB that is available to 
FHFA, the Consumer Financial Protection Bureau (CFPB), or other 
authorized users of the NMDB is de-identified and does not include 
directly-identifiable information, such as borrower/co-borrower name, 
address, Social Security number or date of birth.
    Construction of the NMDB begins with a random 1-in-20 sample of all 
first lien mortgages in the credit repository's files that were 
outstanding at any time between January 1998 (the start date of the 
data collection at the credit repository) and June 2012 (the start date 
of the Project). Each quarter a random 1-in-20 sample of mortgages that 
are newly reported to the credit repository is added. Currently the 
NMDB has been updated with this credit repository data through June 
2015 and it will continue to be updated in the future. Mortgages remain 
in the NMDB until they terminate through prepayment (including 
refinancing), foreclosure or maturity. Information from credit 
repository files on each borrower associated with the mortgages in the 
NMDB will be collected from one year prior to origination to one year 
after termination of the mortgage.
    In addition to the creation of the NMDB, the Project includes 
voluntary surveys of mortgage borrowers as part of the Surveys. The 
Surveys' target universe is first-lien closed-end residential mortgages 
and the associated borrowers. The Surveys supplement the NMDB with 
information not currently available through existing data sources. To 
achieve this objective, the Surveys draw their samples from mortgages 
that are part of the NMDB.
    Responses to the Surveys will be maintained in de-identified form 
as part of the Project. Individuals contacted by the Surveys may choose 
to opt out of any future communications about the Surveys. 
Participation in the Surveys and opt-out list is voluntary and the opt-
out list is kept separate from the NMDB by a third party vendor. The 
opt-out list contains the name and address of those individuals who 
have opted out of receiving communications about the Surveys in order 
to ensure that these individuals do not receive any future 
communications about the Surveys after opting out. FHFA and CFPB 
employees will not have access to this list.
    This notice satisfies the Privacy Act requirement that an agency 
publishes a system of records notice in the Federal Register when there 
is an addition or change to the agency's systems of records. Although 
Congress established general exemptions and specific exemptions that 
could be used to exempt records from provisions of the Privacy Act, the 
Director of FHFA has determined that records and information in this 
system of records are not exempt from the requirements of the Privacy 
Act.
    As required by the Privacy Act, 5 U.S.C. 552a(r), and pursuant to 
paragraph 4c of Appendix I to OMB Circular No. A-130, ``Federal Agency 
Responsibilities for Maintaining Records About Individuals,'' dated 
February 8, 1996 (61 FR 6427, 6435 (February 20, 1996)), FHFA has 
submitted a report describing the system of records covered by this 
notice to the Committee on Oversight and Government Reform of the House 
of Representatives, the Committee on Homeland Security and Governmental 
Affairs of the Senate, and the Office of Management and Budget.

III. Revised System of Records

    The revised system of records notice is set out in its entirety and 
described in detail below. The revisions from the previous SORN that 
FHFA issued in April 2014 include: (1) Deleting certain data fields 
that will not be collected and will not be part of the Project (i.e., 
language, religion, census block, telephone number, and latitude/
longitude); (2) clearly delineating the individuals covered by the 
system; (3) deleting various routine uses and adding one where de-
identified data may be shared with federal financial regulators and 
other U.S. Government agencies for supervisory purposes and for 
conducting research and analysis related to the mortgage markets; (4) 
clearly articulating that for purposes of updating the database, 
information will be updated through a de-identified database-specific 
constructed loan identifier or encrypted unique identification numbers 
that will be used solely to aid in the compiling and

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tracking of the data used from other matching datasets; and (5) 
notifying the public of the existence of an opt-out list and the 
information contained therein.
FHFA-21

SYSTEM NAME:
    National Mortgage Database Project.

SECURITY CLASSIFICATION:
    Sensitive but unclassified.

SYSTEM LOCATION:
    Federal Housing Finance Agency, 400 Seventh Street SW., Washington, 
DC 20024, and Experian Information Solutions Inc., 475 Anton Blvd., 
Costa Mesa, CA 92626.

CATEGORIES OF INDIVIDUALS COVERED BY THE SYSTEM:
    Across the three components of the National Mortgage Database 
Project, information about individuals in the system will contain 
records that have been collected from: (1) Credit repository data; (2) 
administrative data sources including existing mortgage data from the 
Federal National Mortgage Association (Fannie Mae), the Federal Home 
Loan Mortgage Corporation (Freddie Mac), the Federal Home Loan Banks 
(Banks), the Federal Housing Administration (FHA), the United States 
Department of Veterans Affairs (VA), and other government agencies; (3) 
Home Mortgage Disclosure Act (HMDA) data; (4) members of the public as 
part of the National Surveys of Mortgage Borrowers; and (5) other 
commercially available mortgage, property, and appraisal sources.

CATEGORIES OF RECORDS IN THE SYSTEM:
    This revised system of records covers the National Mortgage 
Database Project (``Project''), which is comprised of three components: 
(1) The National Mortgage Database (``NMDB''); (2) the information used 
to create the NMDB but will not be contained within the NMDB; and (3) 
National Surveys of Mortgage Borrowers (``Surveys''). Across these 
three components of the NMDB Project, records include five forms of 
loan-level data: mortgage record, real estate transaction, household 
demographic data on the borrower(s), physical characteristics of the 
house and neighborhood, and performance data on the mortgage and credit 
lines (i.e., credit cards, student loans, auto loans, and other loans 
reported to credit bureaus) of the mortgage borrower(s). The three 
components are described below.
    Under the first component and when the development phase of the 
NMDB is completed, the NMDB will contain de-identified records of 
borrowers and properties associated with a 1-in-20 nationally 
representative random sample of mortgages. These de-identified records 
may include: (1) Borrower(s) information (age, ZIP Code, race/
ethnicity, gender, presence of children by various age categories, 
household income, credit score(s) of borrower(s) at origination, 
deceased indicator, and marital status); (2) Mortgage Information 
(current balance, actual monthly payment, delinquency grid, scheduled 
monthly payment, refinanced amount, and bankruptcy information); (3) 
Credit card/other loan information (account type, credit amount, 
account balance amount, account past due amount, account minimum 
payment amount, account actual payment amount, account high balance 
amount, account charge off amount, and second mortgage); (4) Property 
Attributes (property type, number of bedrooms and bathrooms, square 
footage, lot size, year built/age of structure, units in structure, 
most recent assessed value (per tax roll), year of most recent assessed 
value, effective age of structure, project name, and neighborhood 
name); (5) Real Estate Transaction Attributes (sales price, down 
payment, occupancy status (own, rent), new versus existing home, 
county, census tract, and date purchased); and (6) Mortgage 
Characteristics Attributes (mortgage product and purpose, origination 
date, acquisition date, amount of mortgage, refinanced amount, amount 
of down payment, term of mortgage, interest rate of mortgage, source of 
mortgage/mortgage channel, mortgage insurance type, loan to value at 
origination, origination amount/credit limit, originator, servicer(s), 
debt to income ratio at origination, number of borrower(s), number of 
units covered by the mortgage and the total number of units in the 
associated property, presence of prepayment penalty, origination points 
paid by borrower(s), discount points paid by borrower(s), balloon 
payment date/amount, percent of down payment, and secondary market 
indicator).
    Under the second component, and solely for the purposes of matching 
records in the NMDB with other datasets as part of the construction of 
the NMDB, records may include: borrower(s) information such as name, 
address, Social Security number, date of birth, and mortgage account 
number. Records with direct identifying information, including name, 
address, Social Security numbers, date of birth, and mortgage account 
numbers, will be used solely by a credit repository behind a firewall 
for purposes of matching the records with other datasets, which will 
better enable FHFA to perform the statutory functions identified below. 
FHFA and Consumer Financial Protection Bureau (CFPB) employees will not 
have access to this direct identifying information.
    The matching will be conducted by a credit repository. The matching 
will be conducted behind a firewall using a blind matching process on a 
1-in-20 nationally representative random sample. FHFA and CFPB 
employees will not have access to this blind matching process.
    After the matching is complete, the records with direct identifying 
information (name, Social Security number, date of birth, and mortgage 
account number) will be permanently destroyed by the credit repository 
and will not be maintained. A de-identified dataset, as described 
above, will be used for conducting research on and analysis of the 
mortgage markets.
    FHFA may obtain updates or supplements to this de-identified 
dataset and, in those circumstances, may use record locaters unique to 
the source providing the update in order to update or supplement 
records. In these instances, FHFA's credit repository vendor may retain 
property address solely for the purpose of updating matches or 
conducting future matches with new data sets. FHFA and CFBP employees 
will not have access to this information.
    Under the third component, the Surveys will collect and maintain 
records on demographic information from a subset of individuals who 
voluntarily respond to the Surveys to include: education status, 
military status, financial events and life events in the last couple of 
years, and assets and wealth. An opt-out list will be maintained by a 
third party vendor containing the name and address for those 
individuals who have opted-out in order to ensure that they do not 
receive future communications from the Surveys. FHFA and CFPB employees 
will not have access to this list.

AUTHORITY FOR MAINTENANCE OF THE SYSTEM:
    12 U.S.C. 4511, 4513, 4543, and section 1324 of the Federal Housing 
Enterprises Financial Safety and Soundness Act of 1992 (Safety and 
Soundness Act) as amended by section 1125 of the Housing and Economic 
Recovery Act of 2008 (12 U.S.C. 4544 and 4544(c)).

PURPOSE(S):
    The records in this system of records are collected and maintained 
in order to facilitate mandatory reporting under the

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Safety and Soundness Act as well as to conduct research, performance 
modeling, and examination monitoring. The statutory mandate for a 
monthly mortgage market survey requires FHFA to survey the full breadth 
of the mortgage market, including mortgages that are eligible for 
purchase by Fannie Mae and Freddie Mac and those that are not. Under 
this statutory mandate, FHFA is required to collect data on the 
characteristics of individual mortgages including, among other items, 
the price of the property, the terms of mortgages, and the 
creditworthiness of borrowers. The records in the opt-out list are 
maintained by a third party vendor in order to ensure that those 
individuals who have opted out of receiving communications about the 
Surveys do not receive any further communications.

ROUTINE USES OF RECORDS MAINTAINED IN THE SYSTEM, INCLUDING CATEGORIES 
OF USERS AND THE PURPOSES OF SUCH USES:
    In addition to those disclosures generally permitted under 5 U.S.C. 
552a(b) of the Privacy Act, these records or information contained 
therein may specifically be disclosed outside FHFA as a routine use 
pursuant to 5 U.S.C. 552a(b)(3) as follows:
    (1) When (a) it is suspected or confirmed that the security or 
confidentiality of information in the system of records has been 
compromised; (b) FHFA has determined that as a result of the suspected 
or confirmed compromise there is a risk of harm to economic or property 
interests, identity theft or fraud, or harm to the security or 
integrity of this system or other systems or programs (whether 
maintained by FHFA or another agency or entity) that rely upon the 
compromised information; and (c) the disclosure is made to such 
agencies, entities, and persons who are reasonably necessary to assist 
in connection with FHFA's efforts to respond to the suspected or 
confirmed compromise and prevent, minimize, or remedy such harm.
    (2) To members of advisory committees that are created by FHFA or 
by Congress to render advice and recommendations to FHFA or to 
Congress, to be used solely in connection with their official, 
designated functions.
    (3) To contractor personnel and other authorized individuals 
working on a contract, cooperative agreement, or project for FHFA or 
CFPB related to the NMDB.
    (4) To the Office of Management and Budget, Department of Justice, 
Department of Homeland Security, or other federal financial regulatory 
agencies to obtain advice regarding statutory, regulatory, policy, and 
other requirements related to the purpose for which FHFA collected the 
records.
    (5) To the National Archives and Records Administration or other 
federal agencies pursuant to records management inspections being 
conducted under the authority of 44 U.S.C. 2904 and 2906.
    (6) To a federal agency, organization, or individual for the 
purpose of performing audit or oversight operations as authorized by 
law, but only such information as is necessary and relevant to such 
audit or oversight function.
    (7) To an FHFA regulated entity.
    (8) De-identified, anonymized data with the CFPB in order to 
facilitate reporting under the Dodd-Frank Wall Street Reform and 
Consumer Protection Act (Pub. L. 111-203), as well as to conduct 
research, performance modeling, and market monitoring.
    (9) De-identified, anonymized data to federal financial regulators 
and other U.S. Government agencies for conducting research and analysis 
related to the mortgage markets and for supervisory purposes; servicers 
are not identified and information cannot be used for enforcement 
actions against servicers.

DISCLOSURE TO CONSUMER REPORTING AGENCIES:
    None.

POLICIES AND PRACTICE FOR STORING, RETRIEVING, ACCESSING, RETAINING AND 
DISPOSING OF RECORDS IN THE SYSTEM:
STORAGE:
    Records are maintained in electronic format, paper form, and 
magnetic disk or tape. Electronic records are stored in computerized 
databases. Paper and magnetic disk or tape records are stored in locked 
file rooms, locked file cabinets, or locked safes.

RETRIEVABILITY:
    For the purposes of compiling data from the data sources under the 
second component of the Project, the records may contain anonymized 
personal identifiers (i.e., a database-specific constructed loan 
identifier or encrypted unique identification numbers) for purposes of 
matching the records with other datasets. After the matching is 
complete, a de-identified copy of the matched dataset will be used 
under the first component of the Project for conducting research and 
analysis as described above. FHFA may retain these anonymized personal 
identifiers after the matching, but only for the purpose of performing 
similar matches on future data acquisitions. Under the third component 
of the Project for the Surveys opt-out list, information will be held 
by a third party vendor and may be retrieved by that vendor by name or 
address.

SAFEGUARDS:
    Records are safeguarded in a secured environment. Buildings where 
records are stored have security cameras and 24-hour security guard 
service. Computerized records are safeguarded through use of access 
codes and other information technology security measures. Paper records 
are safeguarded by locked file rooms, locked file cabinets, or locked 
safes. Access to the records is restricted to those individuals who 
require access to the records in the performance of official duties 
related to the purposes for which the system is maintained and who have 
agreed, in writing, to maintain the confidentiality and integrity of 
the data.

RETENTION AND DISPOSAL:
    Records are maintained in accordance with National Archives and 
Records Administration and FHFA retention schedules. Records are 
disposed of according to accepted techniques.

SYSTEM MANAGER(S) AND ADDRESS:
    Project Manager, National Mortgage Database Project, Federal 
Housing Finance Agency, 400 Seventh Street SW., Washington, DC 20024.

NOTIFICATION PROCEDURES:
    Direct inquiries as to whether this system contains a record 
pertaining to an individual to the Privacy Act Officer. Inquiries may 
be mailed to the Privacy Act Officer, Federal Housing Finance Agency, 
400 Seventh Street SW., Washington, DC 20024, or electronically at 
http://www.fhfa.gov/AboutUs/FOIAPrivacy/Pages/Privacy.aspx in 
accordance with the procedures set forth in 12 CFR part 1204.

RECORD ACCESS PROCEDURES:
    Direct requests for access to the Privacy Act Officer. Requests may 
be mailed to the Privacy Act Officer, Federal Housing Finance Agency, 
400 Seventh Street SW., Washington, DC 20024, or can be submitted 
electronically at http://www.fhfa.gov/AboutUs/FOIAPrivacy/Pages/Privacy.aspx in accordance with the procedures set forth in 12 CFR part 
1204.

CONTESTING RECORD PROCEDURES:
    Direct requests to contest or appeal an adverse decision for a 
record to the Privacy Act Appeals Officer. Requests may be mailed to 
the Privacy Act Appeals Officer, Federal Housing

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Finance Agency, 400 Seventh Street SW., Washington, DC 20024, or can be 
submitted electronically at http://www.fhfa.gov/AboutUs/FOIAPrivacy/Pages/Privacy.aspx in accordance with the procedures set forth in 12 
CFR part 1204.

RECORD SOURCE CATEGORIES:
    The information in this system will be obtained from: (1) Credit 
repository data; (2) administrative data sources, including mortgage 
data from Fannie Mae, Freddie Mac, the Banks, FHA, VA, and other 
government agencies; (3) HMDA data; (4) other commercially-available 
mortgage, property, and appraisal sources; and (5) individuals who 
voluntarily respond to the Surveys.

EXEMPTIONS CLAIMED FOR THE SYSTEM:
    None.

    Dated: August 20, 2015.
Melvin L. Watt,
Director, Federal Housing Finance Agency.
[FR Doc. 2015-21288 Filed 8-27-15; 8:45 am]
 BILLING CODE 8070-01-P