Topic: Home Mortgage Disclosure Act of 1975 (HMDA)
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We have heard the Illinois Supreme Court recently ruled that a land trustee that executes a mortgage is entitled to receive the TILA disclosures, including the notice of right to rescind for refinancings. Is this correct? Also, should these loans to trusts be reported on our Home Mortgage Disclosure Act loan application register (HMDA LAR) based on this decision?
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Yes, the Illinois Supreme Court held that the trustee of a land trust for residential property is covered by the Truth in Lending Act (TILA) and is entitled to receive TILA’s mandated disclosures and the right of rescission. The Court observed that Regulation Z expands TILA’s right of rescission to “a natural person in whose…
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We request government monitoring information (GMI) on our internet mortgage loan applications. Sometimes, an applicant will check a box indicating that he or she refuses to provide GMI but goes on to complete some or all of the GMI inquiries. How should we report that on our LAR for HMDA purposes?
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We recommend reporting the any GMI that the applicant provides, even if the applicant has checked a box indicating that he or she is refusing to respond to the GMI inquiries. The FFIEC’s HMDA FAQs advise that banks should report partial GMI in this situation: FFIEC HMDA FAQs, Reporting of partial information: Question: If an…
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How do I sign up to receive notification that the HMDA Disclosure Statements are available?
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The FFIEC sign-up page for emails relating to the HMDA disclosure statements is available here: https://service.govdelivery.com/accounts/USFIND/subscriber/new?topic_id=USFIND_4 Once you sign up, you should start to receive FFIEC notices, such as the recent notice regarding the 2014 HMDA Disclosure Statements, which is available here: http://www.ffiec.gov/press/pr092215.htm
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We received a loan application from an individual who inherited an interest in a home, along with six others. The home is not subject to a mortgage. The applicant will not be living in the home but will be renting it to his son. Is this transaction exempt from RESPA and TILA, and should we report it as a purchase or a refinance for HMDA purposes?
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We believe this transaction would be exempt from both TILA and RESPA as a business purpose transaction, since the borrower will be renting out the property. For HMDA purposes, there appears to be a difference of opinion as to whether the transaction is reportable at all. It would not fall under the definition of “refinancing,”…
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HMDA reports are due on March 1, which falls on a Sunday for 2015. Is that the deadline?
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Whenever the HMDA deadline falls on a Saturday or Sunday, the March 1 deadline is moved to the first Monday in March. See FFIEC HDMA Data Processing Timeline. For 2015, the deadline is Monday, March 2, 2015.
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Has the CFPB finalized the new HMDA fields they will be requiring? We heard that we need to begin collecting data this year.
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The CFPB has not yet finalized a rule implementing the new HMDA fields required by the Dodd-Frank Act, and we do not believe that any financial institutions will be required to report on the new data fields for this year. The Dodd-Frank Act added several new HMDA data fields (listed below): Age Application channel (i.e.,…
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If a real estate transaction for the purchase of a property includes additional funds for renovations/improvements, would the loan be considered “construction” for the purpose of the Call Report and/or Supervisory Loan-to-Value limits?
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Call Report The FFIEC Call Report instructions do not specifically define “construction loan” in the glossary, but the instructions make clear that this type of loan should likely be reported as a construction loan. Under item 1.a (Construction, land development, and other land loans), the instructions state that “for purposes of this item, ‘construction’ includes…
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Should we be reporting closed mortgage loans on our HMDA LAR, even if we immediately sell them to Freddie Mac, or is that the responsibility of Freddie Mac?
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The entity that makes the credit decision on a loan application is responsible for reporting that application. As explained in the rule’s staff commentary, the institution that makes a credit decision on a loan application reports the application, “regardless of whose name the loan closes in.” Official Interpretations, 12 CFR 1003, Paragraph 1(c), Comment 2