Revised_ASMB--PRA Revised Supp Statement (2016-06-22)

“AMERICAN SURVEY OF MORTGAGE BORROWERS"
OMB NUMBER 2590-00XX
REVISED SUPPORTING STATEMENT
BACKGROUND
The Federal Housing Finance Agency (FHFA or the Agency) is seeking OMB clearance under the
Paperwork Reduction Act (PRA) for a new collection of information called the “American Survey
of Mortgage Borrowers” (ASMB). 1 The ASMB will be a periodic, voluntary survey of individuals
who currently have a first mortgage loan secured by single-family residential property. The survey
is designed to collect information necessary to allow empirical analysis of two questions of vital
importance to residential mortgage market policymakers and stakeholders:
1. What factors explain or predict which borrowers will become delinquent on their
mortgages?
2. Once a borrower becomes delinquent, what factors explain or predict whether the borrower
will (a) become current on the loan, (b) decide they cannot afford the mortgage and sell the
property or modify the mortgage, or (c) remain delinquent and enter into foreclosure?
The survey questionnaire consists of 92 questions designed to learn directly from mortgage
borrowers about their mortgage experience, including their experience with maintaining a
mortgage under financial stress, their experience in seeking financial assistance, their success in
accessing federally-sponsored programs designed to assist them and, where applicable, any
challenges they may have had in terminating a mortgage loan. It requests specific information on:
the mortgage; the mortgaged property; the borrower’s experience with the loan servicer; and the
borrower’s financial resources and financial knowledge. 2 The survey will be carried out primarily
by a subcontractor, Westat, under the ultimate direction of FHFA. FHFA is also seeking clearance
to pretest the survey questionnaire and related materials from time to time through the use of
cognitive testing. 3

1

The survey was originally to be entitled the “National Survey of Existing Mortgage Borrowers” and was referred to
by that name in the initial PRA notice published in the Federal Register for this information collection. For clarity, the
second notice, which was published simultaneously with the filing of the original version of this Supporting Statement,
references both names.
2
A copy of the draft survey questionnaire is included as Attachment 1 to this Supporting Statement. Copies of the
other communications that will, or may, be sent to respondents are included as Attachment 2.
3
A copy of FHFA’s Cognitive Testing Guidance document, which was provided to the survey subcontractor on
February 9, 2016, is included as Attachment 3 to this Supporting Statement.

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The ASMB will be a component of the larger “National Mortgage Database” (NMDB) Project,
which is a multi-year joint effort of FHFA and the Consumer Financial Protection Bureau (CFPB)
(although the ASMB is being sponsored only by FHFA). The NMDB 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 (Safety and Soundness Act), as amended by the
Housing and Economic Recovery Act of 2008. 4 Section 1324(c) requires that FHFA conduct a
monthly survey to collect data on the characteristics of individual prime and subprime mortgages,
on the borrowers and properties associated with those mortgages, and on such other matters as the
agency’s Director determines to be appropriate in order to enable it to prepare a detailed annual
report on the mortgage market activities of the Federal National Mortgage Association (Fannie
Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) for review by the
appropriate Congressional oversight committees. Section 1324(c) also authorizes and requires
FHFA to compile a database of otherwise unavailable residential mortgage market information and
to make that information available to the public in a timely fashion.
To fulfill those and other statutory mandates, as well as to support policymaking and research
efforts, FHFA and CFPB committed in July 2012 to fund, build and manage the NMDB Project.
When fully complete, the NMDB will be a de-identified loan-level database of closed-end first-lien
residential mortgages. It will: (1) be representative of the market as a whole; (2) contain detailed,
loan-level information on the terms and performance of mortgages, as well as characteristics of the
associated borrowers and properties; (3) be continually updated; (4) have an historical component
dating back before the financial crisis of 2008; and (5) provide a sampling frame for surveys to
collect additional information.
The core data in the NMDB are drawn from a random 1-in-20 sample of all closed-end first-lien
mortgages outstanding at any time between January 1998 and the present in the files of Experian,
one of the three national credit repositories. The NMDB currently contains data on approximately
11.4 million mortgages. About 125,000 mortgages, drawn from a random 1-in-20 sample of the
approximately 2.5 million newly-originated mortgages reported to Experian quarterly, is added to
the NMDB each quarter. Mortgages are followed in the NMDB database until they terminate
through prepayment (including refinancing), foreclosure, or maturity. 5
The NMDB also draws additional information on mortgages in the NMDB datasets from other
existing sources, including the Home Mortgage Disclosure Act (HMDA) database that is
maintained by the Federal Financial Institutions Examination Council (FFIEC), property valuation
models, and administrative data files maintained by Fannie Mae and Freddie Mac and by federal
agencies. Currently, FHFA obtains additional data from its quarterly National Survey of Mortgage
Originations (NSMO), which provides critical and timely information on newly-originated
mortgages and those borrowing that are not available from existing sources, including: the range
of nontraditional and subprime mortgage products being offered, the methods by which these

4

12 U.S.C. 4544(c).
See FHFA’s NMDB Technical Report 15-01 (Aug. 2015). A copy of this report is included as Attachment 4 to this
Supporting Statement.

5

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mortgages are being marketed, and the characteristics of borrowers for these types of loans. 6
FHFA views the NMDB Project as a whole, including the NSMO and ASMB, as the monthly
“survey” required by section 1324(c) of the Safety and Soundness Act. Core inputs to the NMDB,
such as a regular refresh of the credit repository data, occur monthly, though the actual surveys
conducted under the NMDB Project do not.
The ASMB questionnaire will be sent annually to a stratified random sample of 10,000 borrowers
with mortgages in the NMDB. The data in the NMDB will allow FHFA to target subpopulations
(strata) that are of particular interest, such as borrowers who received counseling, borrowers who
are delinquent on their mortgage, or borrowers who obtained a mortgage to purchase a home or to
refinance a mortgage on their existing residence. Sampling within strata will be random and all
strata will be selected. FHFA estimates that the ASMB will generate a 25 percent overall response
rate—i.e., that it will yield approximately 2,500 survey responses. This estimate is based on actual
response rates by selected strata on surveys of borrowers on existing and terminated mortgages
conducted by Freddie Mac in 2013 and 2014 that resulted in response rates of 30 and 20 percent,
respectively.

A. JUSTIFICATION
1. Circumstances Necessitating the Collection of Information
ASMB Questionnaire
The negative effects of mortgage borrower delinquencies, defaults and property foreclosures are
felt widely: by the borrowers and their families; by other owners and residents in the
neighborhoods where foreclosures occur; by mortgage lenders and servicers; by mortgage
investors; by homebuilders and realtors; by local and state governments; and, as was demonstrated
in 2007 and 2008, eventually by the economy as a whole. For that reason, minimizing borrower
delinquencies and defaults has long been an issue of major importance to residential mortgage
market regulators, policymakers, and stakeholders. Despite this, there is today only an imperfect
understanding of the factors that result in borrowers becoming delinquent on their mortgage loan
payments and in delinquent borrowers falling into default and eventually having their properties
foreclosed upon.
There is ample data on the relationship between quantitative benchmarks existing at the time a loan
is made, such as the ratio of mortgage payments to income and loan-to-value ratio, and the
likelihood of borrower delinquency and default. However, the factors that may lead a mortgage
borrower who initially met those benchmarks into delinquency and, potentially, default are not as
well understood. Part of the reason for this is that those factors—which may include: the level and
6

See FHFA’s National Survey of Mortgage Borrowers Technical Report 15-02 (Aug. 2015). A copy of this report is
included as Attachment 5 to this Supporting Statement. The title of the survey, which was formerly referred to as the
“National Survey of Mortgage Borrowers,” was recently changed to the “National Survey of Mortgage Originations,”
primarily to distinguish it more clearly from the ASMB. OMB has cleared the NSMO survey under the PRA and
assigned it control no. 2590-0012. The current OMB clearance expires on December 31, 2016.

3

quality of servicers’ interactions with borrowers; borrowers subjective attitudes about those
interactions, the loan terms, the value of their property, and their life circumstances; and the
availability of financial counseling and the ability and willingness of borrowers to take advantage
of such counseling—are less easily quantified and researchers have not, to date, had the means to
study them in a systematic way.
With the development of the NMDB, there now exists a comprehensive source of information on
borrowers and their mortgages and properties that will permit empirical analysis of these factors for
the first time. While the quarterly NSMO survey provides information on newly originated
mortgages, it does not solicit information on borrowers’ experience with maintaining their existing
mortgages; nor is detailed information on that topic available from any other existing source. The
ASMB is designed to obtain such information.
Each of the 92 questions on the survey questionnaire is designed to elicit one or more of five
different categories of information that are not available in the administrative data and that are
needed either to properly analyze the issues described above or to validate the survey responses.
These categories are: (1) information needed to validate that the survey reached the correct
borrower and that the borrower is providing answers about the correct loan; (2) information about
the mortgage loan that does not exist in sufficient detail in the administrative data; (3) information
about the borrower’s economic circumstances that does not exist, or exists in insufficient detail, in
the administrative data; (4) information about the borrower’s attitudes regarding his or her
mortgage, property, interactions with lenders and servicers, and life circumstances; and (5)
information needed to determine the ultimate outcome of the borrower’s delinquency and the
interim steps that led to that outcome.
Existing research indicates that borrowers’ attitudes and beliefs—regardless of whether they are
factually correct—may represent key variables in determining whether they are likely to become
delinquent on loan payments and whether they are likely to default if they do become delinquent.
Thus, while some of the questions falling into category #4 above seek borrowers’ subjective
impressions about property value and other matters on which objective data may also exist, those
questions are designed to provide a more accurate understanding of the effect that borrowers’
attitudes have on the ultimate outcomes and are not intended to serve as a substitute for objective
data. In order to provide more clarity on the purpose behind those and the other survey questions,
FHFA has included, as Attachment 6 to this Supporting Statement, a document that explains in
more detail each of the five categories listed above and its relationship to the main issues being
investigated, and includes a table indicating for each survey question: (a) the category into which it
falls; (b) whether it could be regarded as sensitive in nature; (c) the policy purpose the information
elicited is intended to serve; and (d) whether the question also appears on the NSMO questionnaire.
Pre-Survey Cognitive Testing
As part of the initial development of the ASMB, the survey subcontractor, Westat, has conducted
nine cognitive tests of individual borrowers to pretest the survey materials. Westat has limited the
group to nine participants in order to avoid any violation of the PRA. Such pretesting helps to
ensure that the survey respondents can and will answer the survey questions and will provide useful
4

data on their experiences with maintaining their existing mortgages. FHFA expects that Westat
will continue to conduct cognitive testing to pretest the materials for subsequent ASMB survey
mailings. FHFA is requesting OMB clearance for those cognitive tests so that they may be
conducted with 10 or more participants while remaining in compliance with the PRA.
2. Use of Data
ASMB Questionnaire
FHFA intends and anticipates that the information collected through the ASMB, in combination
with information obtained from existing sources in the NMDB, will ultimately be widely used for
research and analysis by government agencies and policymakers (including FHFA and CFPB) to
assist them in carrying out their regulatory and supervisory responsibilities or mandates related to
the residential mortgage markets. The collected information will also provide a resource for further
research and analysis by academics and other interested parties outside of the government. As it
has done in the case of the NSMO, FHFA also plans eventually to prepare and make available to
the public one or more reports summarizing the information obtained through the survey and
discussing the conclusions reached through analysis of that information.
In the near-term, the information will be used primarily to assist both FHFA and CFPB in
identifying problematic areas of the residential mortgage market, in accurately assessing the factors
that give rise to those problems, and in developing and implementing policies that are well
designed to minimize the occurrence of those problems in the future. In particular, FHFA
anticipates that the survey data will, in combination with other sources of information and analysis,
provide it and CFPB with a more thorough understanding of the reasons that mortgage borrowers
fall into delinquency and default and that this knowledge will ultimately enable both agencies to
carry out their respective regulatory and supervisory responsibilities in connection with the
residential mortgage market more effectively.
As mentioned under Item #1, policymakers and mortgage market stakeholders today have only an
imperfect understanding of the range of factors that lead mortgage borrowers to fall into
delinquency and default. The assumptions regarding the causes of delinquency and default that
underlie current policies and practices intended to minimize those negative outcomes are based, in
many cases, on anecdotal evidence that has not been rigorously tested against empirical data.
FHFA expects that, at this initial stage, the ASMB will elicit preliminary data on variables that
anecdotal evidence, as well as a limited number of previous studies, suggests may correlate with
higher rates of borrower delinquency and default. The agency also anticipates that analysis of the
survey responses will suggest causative factors that have not yet been hypothesized and that
warrant further study.
FHFA intends to use the information obtained through the initial iterations of the survey
questionnaire to refine the form and content of the questions on subsequent iterations, with the goal
of further testing tentative conclusions drawn from initial data. Both FHFA and CFPB expect that
any conclusions that may be drawn from the survey data will be measured against, and considered
in combination with, information and analyses derived from a variety of other sources before it is
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used as a basis for any rulemaking or policymaking actions. These other sources of information
and analysis may include, in addition to more focused and refined versions of the ASMB itself:
comments from stakeholders and the public on the survey results and on tentative conclusions
drawn from those results; information derived from focus groups designed to provide more indepth information on survey topics; administrative data from, or data from supervisory
examinations of, Fannie Mae, Freddie Mac, or other market participants; and peer-reviewed
academic research.
Specific Uses by FHFA
FHFA intends to make the results of the ASMB available to the public by issuing an official
statistical report of the survey results similar to the report that FHFA has just released regarding the
results of the NSMO. A copy of the NSMO report is included as Attachment 7 to this Supporting
Statement as an example of the type of report that will be prepared for the ASMB.
In addition, the information derived from the ASMB will assist FHFA in fulfilling its statutory
duties to ensure that its regulated entities operate in a safe and sound manner and that their
operations and activities foster liquid, efficient, competitive, and resilient national housing finance
markets. 7 More specifically, in the near term, FHFA will use the collected information and the
conclusions drawn from analyses of that information primarily to assist it in evaluating whether the
loss mitigation policies and practices of Fannie Mae and Freddie Mac (collectively, “the
Enterprises”) are adequate, and in determining how those policies and practices should be changed
if they are shown to be inadequate.
The Enterprises provide liquidity to the residential mortgage market mainly by buying mortgages
from lenders and then packaging the loans into mortgage-backed securities (MBS) that are sold to
investors. In order to attract investors who might not otherwise invest in mortgages, the
Enterprises guarantee the timely payment of principal and interest on the mortgage loans
underlying the MBS that they offer for sale. Because of the guarantees the Enterprises provide,
they must bear the loss when borrowers on the underlying loans default on their payments.
Naturally, the greater the financial losses the Enterprises incur as a result of such borrower defaults,
the more the Enterprises’ abilities to operate in a safe and sound manner and to provide liquidity to
the mortgage markets are compromised.
Under the supervision of FHFA, the Enterprises seek to minimize defaults on the loans they
guarantee (as well as those they hold as portfolio investments) by requiring their counterparties in
those transactions—that is, loan sellers and servicers—to adhere to detailed financial and
operational standards. Among other things, the Enterprises’ operational standards require servicers
to identify delinquent borrowers as early as possible and to work with those borrowers in various
ways, including by encouraging those borrowers to take advantage of financial counseling, to
reduce the possibility of eventual default and foreclosure. 8

7

See 12 U.S.C. 4513(a)(1)(B).
See https://www.fanniemae.com/content/guide/servicing/d/index.html (section of Fannie Mae Servicing Guide that
addresses “Providing Solutions to a Borrower”);
8

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As part of its efforts to ensure the safe and sound operation of the Enterprises, FHFA continuously
assesses the adequacy of their risk management policies and procedures, including the described
seller/servicer requirements. As a result of these assessments, the agency periodically directs the
Enterprises to update their policies and procedures to implement new or revised risk management
approaches that have been identified as being most effective. 9 FHFA will use the information
collected through the ASMB, in combination with other sources of information, as part of its
ongoing assessment of the Enterprises’ seller/servicer requirements—particularly those relating to
lender and servicer interaction with delinquent borrowers and to assisting borrowers with access to
housing counseling.
Specific Uses by CFPB
Similarly, CFPB will use the information derived from the ASMB to assist it in carrying out its
rulemaking and other functions with respect to the residential mortgage finance markets. Among
the primary functions of the Bureau are collecting, researching, monitoring, and publishing
information relevant to the functioning of markets for consumer financial products and services to
identify risks to consumers. 10 In order to support its rulemaking and other functions, the Bureau
may gather and compile information from voluntary surveys of consumers to monitor for risks to
consumers in the offering or provision of consumer financial products or services, including in the
servicing of mortgage loans. 11 Among other things, the ASMB will provide the Bureau with
unique and representative information about the extent to which its mortgage servicing regulations
are adequately protecting consumers. The Bureau’s mortgage servicing regulations require
servicers to, among other things, respond to borrowers’ information requests and notices of error
about their loans, to maintain contact with borrowers who become delinquent, and to follow certain
procedures and timelines in processing borrowers’ loss mitigation applications. 12 The survey
information may be useful to the CFPB in helping to determine whether these requirements need to
be revised, and in carrying out its statutory responsibility to conduct an assessment of each
significant rule. 13
Pre-Survey Cognitive Testing
FHFA will use information collected through the cognitive tests to assist it in drafting and
modifying the survey questions and instructions, as well as the related communications, to read in a
way that will be most readily understood by the survey respondents and that will be most likely to
elicit usable responses. Such information will also be used help the Agency decide on how best to
organize and format the survey questionnaire.
http://www.freddiemac.com/singlefamily/guide/bulletins/pdf/030916Guide.pdf (Freddie Mac Seller/Servicer Guide-Series 9000 items address default management).
9
See, e.g., Federal Housing Finance Agency, Fannie Mae and Freddie Mac Issue New Eligibility Requirements for
Seller/Servicers, News Release (May 20, 2015) at http://www.fhfa.gov/Media/PublicAffairs/Pages/New-EligibilityRequirements-for-SellerServicers.aspx.
10
See 12 U.S.C. 5511.
11
See 12 U.S.C. 5481(5), 5512.
12
See 12 CFR part 1024 (subpart C).
13
See 12 U.S.C. 5512.

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3. Use of Information Technology
The ASMB will use machine-readable paper questionnaires in English and an online electronic
questionnaire in both Spanish and English. The survey subcontractor will edit and scan returned
questionnaires and will deliver the responses electronically to FHFA.
With respect to the cognitive tests, FHFA anticipates collecting data through individual interviews,
which may be conducted with or without electronic assistance, as well as through the use of nonelectronic tools (such as hand-written notes or responses) and electronic tools (such as audio- and
video-recordings).
4. Efforts to Identify Duplication
As explained above, the vast majority of data included in the NMDB has been and will continue to
be drawn from existing sources—i.e., the consumer credit database maintained by one of the
national credit repositories; the HMDA database maintained by FFIEC; and other information in
the possession of FHFA, its regulated entities, or CFPB. Like the existing NSMB survey, the
ASMB survey is intended to obtain needed information that is not available from these other
sources.
5. Impact on Small Entities
This information collection will not have a significant economic impact on a substantial number of
small entities. The survey recipients will be individuals only, and all responses will be voluntarily.
6. Consequences of Less Frequent Collection and Obstacles to Burden Reduction
FHFA currently has firm plans to conduct the ASMB survey only once—in the second quarter of
2016. However, FHFA is requesting OMB clearance to conduct additional periodic surveys under
the ASMB up to once annually in the event the Agency determines that it would be useful to do so.
Less frequent collection would reduce the usefulness of the survey in assisting FHFA and CFPB in
carrying out the regulatory responsibilities described under item #2 and in keeping those agencies
and other interested stakeholders abreast of how the performance of existing mortgages is
influencing the residential mortgage market, whether borrowers are having difficulties maintaining
their existing mortgages, and whether federally-sponsored mortgage assistance programs are
effective.
7. Circumstances Requiring Special Information Collection
There are no special circumstances that require FHFA to conduct the information collection in a
manner inconsistent with OMB guidelines.

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8. Solicitation of Comments on Information Collection
Letters Received in Response to the 60-Day Notice
In accordance with the requirements of 5 CFR 1320.8(d), FHFA published a request for public
comments regarding this information collection in the Federal Register on November 10, 2015. 14
The 60-day comment period closed on January 11, 2016. FHFA received two comment letters—
one from an individual and one from a group of trade associations representing various
constituencies in the financial services industry. 15 The letter from the individual was not
responsive to any of the questions in the notice and contained no comments relating to the ASMB,
the NMBD Project, or any issues arising under the PRA.
The trade associations’ letter raised two issues that are relevant to the compliance of the ASMB
with the PRA. First, the trade associations asserted that that the information FHFA seeks to collect
through the ASMB is, or could soon be, available from other sources and urged the Agency “to
again review existing surveys and data collection efforts to identify redundancies.” The letter cites
numerous existing sources of quantitative data about mortgage borrowers, loan terms, mortgaged
properties and the origination and maintenance of first lien mortgages. However, most of the data
sources cited are those from which the NMDB has drawn the bulk of its existing data. None of
those sources (nor any other sources of which FHFA is aware) provide the type of qualitative
information regarding borrowers’ experience with maintaining a mortgage or their interactions with
mortgage servicers that FHFA seeks to obtain through this information collection.
Second, noting that the draft ASMB questionnaire published with the initial Federal Register
notice was not the final version of the survey instrument, the trade associations urged FHFA “to
solicit additional public input on the substance of the survey when it is complete and before FHFA
puts it into use.” An updated draft of the survey questionnaire appeared as part of the Federal
Register notice that was published simultaneously with the submission of the original version of
this Supporting Statement. The trade associations therefore had 30 additional days within which to
review the survey again and to provide comments to both OMB and FHFA, but provided no
additional comments.
The remainder of the discussion in the letter from the trade associations addressed non-PRA-related
concerns that the commenters’ have about the NMDB Project as a whole. Because those issues are
not relevant to the clearance of this information collection under the PRA, FHFA has not addressed
them in this Supporting Statement.
Letters Received in Response to the 30-Day Notice
In accordance with the requirements of 5 CFR 1320.10(a), FHFA published a second request for
public comments in the Federal Register simultaneously with the submission of the original

14

See 80 FR 69664 (Nov. 10, 2015). A copy of the 60-day Notice is included as Attachment 8 to this Supporting
Statement.
15
Copies of these comment letters are included as Attachment 9 to this Supporting Statement.

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version of this Supporting Statement to OMB on March 24, 2016. 16 The 30-day comment period
closed on April 25, 2016. FHFA received two comment letters—one from the National
Association of Homebuilders (NAHB) and one from the Pennsylvania Housing Finance Agency
(PHFA). 17 As discussed in more detail below, both commenters were in favor of FHFA
conducting the survey and both offered suggestions as to how to improve the survey.
NAHB is a trade association representing more than 140,000 members involved in all aspects of
the residential construction industry. In its letter, NAHB noted that the ability of the home building
industry to meet the nationwide demand for housing “is dependent on an efficiently operating
housing finance system” and that this, in turn, “is dependent on the availability of information
about how the system functions and serves the U.S. population.” The letter stated that NAHB and
its members have a strong interest in the information collection and offered comments and
recommendations on three of the issues raised in the notice: (1) whether the information collection
has practical utility; (2) ways to enhance the quality, utility, and clarity of the information; and (3)
ways to minimize the burden of the collection of information on survey respondents.
First, noting that “the practical utility of information collected by the ASMB is clear,” NAHB
commented,
This information will allow for more in-depth analysis of the mortgage market, that
will not only greatly aid [FHFA] in its task of supervising Fannie Mae, Freddie
Mac, and the Federal Home Loan Banks, but also assist other government agencies,
as well as private sector lenders and policy analysts, to better evaluate market
conditions and make more informed decisions, especially when the ASMB is
integrated into the broader [NMDB].
Although considerable data on mortgage markets may seem to be available from
existing sources, some of the information collected in the ASMB is unique, and no
existing source combines information about individual borrowers, loan
performance, and nature of the homes purchased in the way proposed by the ASMB
as part of the NMDB. Existing sources either lack robust data on mortgage
performance, have limited demographic data, or only collect data on market subsets.
Moreover, many are proprietary and expensive, and therefore not very accessible to
those with limited resources.
FHFA strongly agrees with this statement in that it correctly indicates that some of the information
collected in the ASMB is unique, and that no existing source combines information about
individual borrowers, loan performance, and the nature of the homes purchased in the way
proposed by the ASMB.
Second, NAHB asserts that FHFA could enhance the usefulness of the information collected by
adding to the questionnaire two questions regarding the age of the house securing the borrower’s
16

See 81 FR 15707 (Mar. 24, 2016). A copy of the 30-day Notice is included as Attachment 10 to this Supporting
Statement.
17
Copies of these comment letters are included as Attachment 11 to this Supporting Statement.

10

mortgage loan—information that NAHB regards as “critical.” FHFA agrees that such information
is important and would be useful, but does not believe that the ASMB is the appropriate vehicle
through which to collect the information. The agency intends to review these questions and
potentially add them to the quarterly NSMO questionnaire when it performs its annual review of
that questionnaire later this year.
Finally, NAHB suggests conducting the ASMB electronically through an online survey to reduce
the burden of the collection. As noted under item #3, FHFA will provide the option of taking the
questionnaire online in either Spanish or English.
PHFA is a state agency created by the Commonwealth of Pennsylvania to provide state residents of
modest means or with specialized needs access to safe, affordable housing by providing qualified
borrowers with down payment and closing cost assistance, purchasing and servicing mortgage
loans, and providing funding, training and other resources to its network of housing counseling
agencies. In its letter, the PHFA expressed its hope that FHFA will “commit to conduct the Survey
on an annual basis for longer than three years,” because “continued collection of the Survey will
help identify trends in the residential mortgage market.”
Regarding the survey questionnaire, PHFA suggested FHFA additional questions that should be
added about the borrower’s experience with housing counseling, characteristics of the borrower’s
neighborhood, and the borrower’s experience with making loan payments. With respect to housing
counseling, PHFA suggests additional questions addressing the type of counseling attended, the
timing of the counseling, the reason the borrower attended counseling, and whether the counseling
led the borrower to choose a particular loan product. With respect to the borrower’s neighborhood,
PHFA suggested adding a question asking which neighborhood characteristics lead the borrower to
find it desirable. Finally, with respect to loan payments, PHFA suggests that FHFA rephrase and
reorder a number of questions.
FHFA carefully considered all of PHFA’s comments and suggestions. Several of the suggestions
either had already been incorporated into the newest draft of the questionnaire or had been made
moot by the latest round of revisions. FHFA declined to incorporate a number of PHFA’s
suggested edits to existing questions because it had already concluded through consultation with
survey experts, consideration of the cognitive testing results, and other analysis that the existing
phrasing of those questions is most appropriate. Finally, while FHFA believes that the additional
questions regarding housing counseling suggested by PHFA could elicit valuable information, it
has declined to add them at this time because their addition would significantly increase the length
of the survey questionnaire. Based on the results of the initial ASMB survey, FHFA will consider
adding those questions to future iterations of the survey questionnaire
9. Provision of Payments or Gifts to Respondents
Each cognitive testing participant will receive approximately $50 as an incentive payment.

11

Survey recipients will receive a $5 cash payment as an incentive to complete and return the ASMB
questionnaire. Recipients who have not responded after two contacts will receive an additional
cash payment of $5.
The survey implementation strategy comprises four respondent contacts over a seven-week period:
•
•
•
•

Week 1: Printed questionnaire, cover letter, and cash incentive (entire survey sample
population).
Week 2: First reminder letter (entire survey sample population).
Week 5: Second reminder letter, printed questionnaire, and additional cash incentive
(sampled borrowers who have not responded by Week 4).
Week 7: Third reminder letter, which includes the due date for returning the questionnaire,
to close the communication loop (sampled borrowers who have not responded by Week 6).

10. Assurance of Confidentiality
Section 1324 of the Safety and Soundness Act authorizes FHFA to modify the mortgage data
released to the public as necessary to ensure that it contains no “representation of information that
permits the identity of a borrower to which the information relates to be reasonably inferred by
either direct or indirect means.” 18 The NMDB, including data obtained through the ASMB, will
contain de-identified information and the agencies will take appropriate precautions to ensure that
individual borrowers cannot be identified through the database or through any datasets that may be
made available to researchers or the public. 19 The ASMB questionnaire and cover letters will
contain a statement to this effect and, in addition, will make clear that respondents should not
include their name, address or any other personally identifiable information on the completed
questionnaire. 20
While the survey subcontractor will know the identity of the cognitive testing participants, that
information will not be conveyed to FHFA and will not be included in the NMDB in any form.
11. Questions of a Sensitive Nature
Of the 92 questions on the survey questionnaire, approximately 25 might be considered to be of a
sensitive nature by particular borrowers. 21 Questions that FHFA has identified as potentially
sensitive include those requesting information on loan terms, property value, delinquency status,
experience with foreclosure, actual and expected employment status, major life events, actual and
expected income, actual and expected financial difficulties and efforts to deal with them, marital
status, race and ethnicity.
18

See 12 U.S.C. 4544(c)(3), (4).
See NMDB Technical Report 15-01 (Aug. 2015) (Attachment 4 to this Supporting Statement).
20
A copy of the System of Records Notice (SORN) that is currently in effect for the NMDB is included as Attachment
12 to this Supporting Statement. It can also be accessed electronically at https://www.gpo.gov/fdsys/pkg/FR-2015-0828/pdf/2015-21288.pdf.
21
The questions that FHFA has identified as being potentially sensitive are indicated on the question-by-question table
included in Attachment 6 to this Supporting Statement.
19

12

Understandably, borrowers that have become delinquent or have defaulted on their loan payments,
or whose homes have been foreclosed upon, may experience feelings of shame and embarrassment
about disclosing information about those experiences and about the factors that led to them.
However, in order for policymakers to design and implement policies and requirements that will be
effective in reducing the frequency and severity of delinquencies, defaults, and foreclosures, they
must have access to accurate data that will allow them to understand the underlying reasons for
those negative outcomes. In addition, while FHFA understands that some survey recipients will be
reluctant to answer questions about those sensitive topics, the agency believes that others will look
upon doing so as an opportunity to express themselves about issues of concern to them and to help
others to avoid falling into similar difficult circumstances.
12. Estimates of the Hour Burden of the Information Collection
This information collection comprises two components: (I) the ASMB survey; and (II) the pretesting of the survey questionnaire and related materials through the use of cognitive testing.
While FHFA currently has firm plans to conduct the survey only once—in the second quarter of
calendar year 2016—it may decide to conduct further periodic ASMB surveys once the first survey
is completed. The Agency therefore estimates that the survey will be conducted, on average, once
annually over the next three years and that it will conduct two rounds of pre-testing on each set of
survey materials.
FHFA estimates that the total annualized hour burden imposed upon respondents by these two
information collections will be 5,024 hours. These estimates are based on the following
calculations:
I. Conducting the Survey
The estimated annualized hour burden associated with conducting the ASMB is 5,000 hours. The
ASMB questionnaire will be sent to 10,000 recipients each time the survey is conducted. Although
FHFA expects a 25 percent response rate, this burden estimate assumes that all of the recipients
will respond. The 30 minutes per survey completion time estimate includes the gathering of
necessary materials to respond to the questions and is based on the reported experience of
respondents to the NSMB questionnaire, which contains a similar number of questions.
Recipients read and complete survey questionnaire and return the completed form to the survey
subcontractor:
•
•
•
•
•

Completion time per recipient:
Survey mail-outs annually:
Recipients per survey:
Total recipients annually:
Total hours annually:

0.5 hours
1
10,000
10,000
5,000 hours

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II. Pre-Testing of Survey Materials
The estimated annualized hour burden associated with the pre-testing of the survey materials is 24
hours.
Selected individuals participate in cognitive testing to pre-test the survey questionnaire and
related materials:
•
•
•
•
•

Participation time per person:
Survey mail-outs annually:
Participants per survey: 24
Total participants annually:
Total hours annually:

1 hour
1
24
24 hours

13. Estimated Total Annualized Cost Burden to Respondents
There will be no costs imposed upon the respondents by this information collection. Postage costs
to return the survey questionnaire will be pre-paid by the survey subcontractor.
14. Estimated Cost to the Federal Government
The estimated annual burden to the federal government is 10 hours and $355,700 calculated as
follows:
FHFA analyst embeds ASMB data into query-based electronic database:
•
•
•
•
•

Time per survey mail-out:
Total survey mail-outs per year:
Total hours per year:
Hourly rate:
Total cost:

10 hours
1
10 hours
$74 (includes salary, benefits, and overhead)
$740

In addition, FHFA will pay $354,960 to the survey subcontractor each time it conducts a survey.
Included in this amount are approximately: $110,000 for printing costs; $90,000 for the cash
incentive payments to survey recipients; $43,000 for postage costs; and $38,000 for pre-testing the
survey materials.
$740 (hourly cost) + $354,960 (paid to subcontractor) = $355,700.
15. Reasons for Change in Burden
This is a new information collection, so there is no change in burden from any previous estimates.

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16. Plans for Tabulation, Statistical Analysis and Publication
As discussed under item #2, FHFA plans to produce a summary report to be made available to the
public based on aggregate data collected from each ASMB survey. Other than that report, there are
no specific plans for tabulation, statistical analysis or publication at this time.
17. If Seeking Approval to Not Display the Expiration Date for OMB Approval of the
Information Collection, Explain the Reasons Why Display Would Be Inappropriate
FHFA plans to display the expiration date for OMB approval.
18. Explain Each Exception to the Topics of the Certification Statement Identified in
“Certification for Paperwork Reduction Act Submission.”
There are no exceptions to the topics of the certification statement identified in the “Certification
for Paperwork Reduction Act Submission.”

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B.

COLLECTIONS OF INFORMATION EMPLOYING STATISTICAL METHODS

1. Describe (including a numerical estimate) the potential respondent universe and any
sampling or other respondent selection methods to be used. Data on the number of
entities (e.g., establishments, State and local government units, households, or persons) in
the universe covered by the collection and in the corresponding sample are to be provided
in tabular form for the universe as a whole and for each of the strata in the proposed
sample. Indicate expected response rates for the collection as a whole. If the collection
had been conducted previously, include the actual response rate achieved during the last
collection.
For the initial survey, a stratified random sample of 10,000 borrowers who had first-lien mortgages
outstanding as of January 1, 2015 will be drawn from among the mortgages contained in the
NMDB in March 2016. As explained above, the NMDB is a 1-in-20 sample of all closed-end firstlien mortgages outstanding at any time between January 1998 and the present. FHFA estimates
that there were 55 million outstanding first-lien mortgages in the U.S. as of January 1, 2015 and
that the NMDB contains information on approximately 2.75 million of those mortgages.
FHFA estimates that the ASMB will generate a 25 percent overall response rate—i.e., that it will
yield approximately 2,500 survey responses. This estimate is based on actual response rates by
selected strata on surveys of borrowers on existing and terminated mortgages conducted by Freddie
Mac in 2013 and 2014 that resulted in response rates of 30 and 20 percent, respectively. The
estimated response rates for the ASMB are derived from the Freddie Mac response results as those
surveys drew from the same populations as the ASMB. Also, the CFPB experienced a 22 percent
response rate for its “Debt Collection” survey in January 2015. FHFA expects that the ASMB
would have a higher response rate than that CFPB survey since the ASMB target population,
homeowners, is likely to be more stable than the overall population of individuals with a debt
collection.
2. Describe the procedures for the collection of information, including:
• Statistical methodology for stratification and sample selection,
• Estimation procedure,
• Degree of accuracy needed for the purpose described in the justification,
• Unusual problems requiring specialized sampling procedures, and
• Any use of periodic (less frequently than annual) data collection cycles to reduce
burden.
The intent of the survey is to compare the experience different groups of mortgage borrowers had
maintaining their mortgage. For the initial survey, the targeted subpopulations (strata) that are of
particular interest are mortgage borrowers who were in distress (having problems remaining
current on their mortgage) compared to borrowers who were not in distress in January 2015. The
sample strata are designed to produce final usable samples of at least 750 borrowers in each of
three groups of primary interest to the survey: those who are a) never delinquent, b) were
delinquent and have recovered, and 3) were delinquent and did not recover. These sample sizes
should provide a precision level of at least +/- 3 percent for comparisons among the three groups.
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The NMDB includes comprehensive information, provided by Experian, on the performance of
each of the mortgage loans contained in the database, which will enable FHFA to draw an accurate
sample for the desired strata. For example, the NMDB contains information on missed payments
that will allow FHFA to identify borrowers who were in distress and to oversample this group.
3. Describe methods to maximize response rates and to deal with issues of non-response. The
accuracy and reliability of information collected must be shown to be adequate for
intended uses. For collections based on sampling, a special justification must be provided
for any collection that will not yield "reliable" data that can be generalized to the
universe studied.
As explained in response to question #9 in Part A, to maximize response rate, survey respondents
will receive a cash payment as an incentive to complete and return the questionnaire. To further
increase response rates, survey recipients will also be given the option of completing the survey
online in either English or Spanish. The first mailing will contain an insert, in both English and
Spanish, which will inform recipients of those options and provide the appropriate web addresses
to access those electronic versions of the survey. The insert will also provide Spanish-speaking
recipients with a telephone number through which they may request a paper copy of the survey in
Spanish.
Both item and survey non-response will be addressed using information from other sources. One
advantage that the ASMB will have over other surveys is the availability of credit and
administrative data, much of which appears to be quite reliable. These data will be used to assist in
the editing and imputation process. Three primary sources of such data are: (1) credit data from
Experian on sample loans; (2) data on the survey respondents obtained by Experian from other
sources, including loan servicers and data companies; and (3) information for loans that could be
matched to Home Mortgage Disclosure Act (HMDA) files.
After editing and cleaning the survey response data, FHFA will impute missing responses using
statistical models estimated based on the credit and administrative data and answers to other
questions in the survey. Missing values for item non-response will be imputed statistically using an
iterative process. Individual statistical models will be developed for each question that used the
key demographic variables as well as credit or administrative data such as loan amount and credit
score as regressors in linear probability, logistic, or cell-based models (since almost all variables in
the survey are categorical). In all instances the imputation will incorporate a random component
that reflects the accuracy of the imputation model. Variables will be imputed in order, with higher
order variables that dictated a skip-pattern imputed first, before the variables conditioned on the
pattern are to be imputed. Once the first round of imputations is completed, the process will be
repeated with expanded predictive linear or logistic models that incorporated some of the newly
imputed variables as regressors for other variables. This iteration ensures that correlations among
the imputed values will better reflect correlations among observations where responses were
available.

17

Commonly, in survey sampling, some individuals chosen for the sample are unwilling or unable to
participate in the survey. Non-response bias is the bias that results when respondents differ in
meaningful ways from non-respondents. When non-response bias is present, rather than accept a
poor match between the sample and the population, it is now common to use weights to bring the
two more closely into line. This is known as “non-response weighting.” The ASMB will have
extensive credit and administrative data on both responding and non-responding borrowers that
will be used to estimate non-response weights.
4. Describe any tests of procedures or methods to be undertaken. Testing is encouraged as
an effective means of refining collections of information to minimize burden and improve
utility. Tests must be approved if they call for answers to identical questions from 10 or
more respondents. A proposed test or set of tests may be submitted for approval
separately or in combination with the main collection of information.
FHFA will use information collected through the cognitive tests to assist it in drafting and
modifying the survey questions and instructions, as well as the related communications, to read in
the way that will be most readily understood by the survey respondents and that will be most likely
to elicit usable responses. Such information will also be used to help the Agency decide on how
best to organize and format the survey questionnaire. Cognitive testing will be especially
important for phrasing questions to elicit responses from a specific strata (borrowers who were in
distress) that may feel stigmatized. A copy of FHFA’s Cognitive Testing Guidance document,
which was provided to the survey subcontractor on February 9, 2016, is included as Attachment 3
to this Supporting Statement.
5. Provide the name and telephone number of individuals consulted on statistical aspects of
the design and the name of the agency unit, contractor(s), grantee(s), or other person(s)
who will actually collect and/or analyze the information for the agency.
The names of and contact information for individual stakeholders from FHFA, CFPB, Freddie
Mac, and Experian, including those who were consulted on statistical aspects of the design and
who will analyze the data, appear in the list that is included as Attachment 13 to this Supporting
Statement. FHFA also consulted with the following:
Dr. Mick P. Couper
Survey Research Center and the Institute for Social Research
University of Michigan
426 Thompson Street
Ann Arbor, MI 48104
(734) 647-3577
Dr. Don A. Dillman
Department of Sociology and the Social & Economic Sciences Research Center
Washington State University
Pullman, WA 99164-4014
(509) 335-1511
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The subcontractor hired by Experian to carry out the survey and the cognitive testing is:
Westat
1600 Research Blvd,
Rockville, MD 20850

19