FHFA Drops ABA-Opposed URLA Language Preference Question

Responding to calls from ABA and other trade associations, the Federal Housing Finance Agency yesterday announced that it will drop a proposed question from the Uniform Residential Loan Application that asks borrowers to indicate their language preference. ABA previously raised concerns that including a language preference question would create a reasonable expectation that the customer would receive communication in their desired language, and could leave lenders open to UDAAP liability if they did not proceed in the specified language.

FHFA acknowledged that there were many unresolved issues surrounding the question’s inclusion, and that resolving those issues would unduly postpone the rollout of the new URLA. While the question will be left off of the URLA, the agency said that it will take steps to begin gathering data on customer language preferences through other channels, including national surveys, requests for input and collaboration with other agencies and consumer representatives.