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We are a HMDA reporter but have not reported open lines of credit in the past, and we are exempt from reporting in 2018 (we do not meet the 500 loan threshold for open-end lines of credit). Under Regulation B, can we collect government monitoring information (GMI) for open-end home purchase loans and refinances? – IBA Compliance Connection

IBA Compliance Connection

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We are a HMDA reporter but have not reported open lines of credit in the past, and we are exempt from reporting in 2018 (we do not meet the 500 loan threshold for open-end lines of credit). Under Regulation B, can we collect government monitoring information (GMI) for open-end home purchase loans and refinances?

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Yes, Regulation B permits (and actually requires) lenders to collect an applicant’s GMI — ethnicity, race, sex, age, and marital status — open-end home purchase loans or refinancings, provided that they are to be secured by the applicant’s principal residence.

In general, Regulation B prohibits lenders from collecting certain personal information from applicants, including ethnicity, race, sex, and other types of information. However, Regulation B includes an exception to allow lenders to collect certain personal information as required for government monitoring purposes. These GMI collection requirements apply to credit applications that are made for the “purchase or refinancing of a dwelling occupied or to be occupied by the applicant as a principal residence.” In the context of open-end lines of credit, this requirement applies only if it is “readily apparent to the creditor when the application is taken that the primary purpose of the line is for the purchase or refinancing of a principal dwelling.”

For resources related to our guidance, please see:

  • Regulation B, 12 CFR 1002.5(a)(2) (“Notwithstanding paragraphs (b) through (d) of this section, a creditor shall request information for monitoring purposes as required by § 1002.13 for credit secured by the applicant’s dwelling. . . .)

  • Regulation B, 12 CFR 1002.13(a)(1) (“A creditor that receives an application for credit primarily for the purchase or refinancing of a dwelling occupied or to be occupied by the applicant as a principal residence, where the extension of credit will be secured by the dwelling, shall request as part of the application” the applicant’s ethnicity, race, sex, marital status, and age.)

  • Regulation B, Official Interpretations, Paragraph 13(a), Comment 5 (“. . . An application for an open-end home equity line of credit is not subject to this section unless it is readily apparent to the creditor when the application is taken that the primary purpose of the line is for the purchase or refinancing of a principal dwelling.)