The Evolution of HMDA by alicejenny

VIEWS: 3 PAGES: 14

									                                                          4/12/2012




   HMDA Reporting for Small
Businesses & Other HMDA Helpers


                 PRESENTED BY

             SUSAN A. DEFREESE

      CHIEF COMPLIANCE OFFICER
     OLD FLORIDA NATIONAL BANK
                  ORLANDO, FLORIDA




        The Evolution of HMDA
               The Home Mortgage Disclosure Act




Enacted by congress in 1975
Added Race/Ethnicity Data in 1989
Added Pricing Data in 2004
Added 12 New Fields in 2010
Rule‐writing authority transferred to CFPB on 7‐21‐2011
New reporting fields required only after implementing 
regulation




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                    Purpose of HMDA
The Home Mortgage Disclosure Act was enacted by Congress in 1975 and is
implemented by the Federal Reserve Board’s Regulation C. Authority was
transferred to the Consumer Financial Protection Bureau (CFPB or the Bureau) in
2011. Reg C provides the public loan data that can be used to assist:

   In determining whether financial institutions are serving the 
   housing needs of their communities
   Public officials in distributing public‐sector investments so as 
   to attract private investment to areas where it is needed
   Identifying possible discriminatory lending patterns and 
   enforcing antidiscrimination statutes




                  Uses of HMDA Data

The public, auditors, regulators, attorneys and 
consumer advocacy groups use HMDA data as a 
means to:

     Identify discriminatory practices
     File lawsuits
     Encourage regulatory enforcement action




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               HMDA Reporting
                        Who Reports?

Reg C applies to certain financial institutions, including banks, 
savings associations, credit unions & other mortgage lending 
institutions. In 2011, over 16.3M loan records for calendar 
year (CY) 2010 were reported by 7,923 institutions.
Financial Institutions if:
   Exceed asset threshold ($40M for 2011 data collection)
   Had an office in an MSA preceding December 31
   Originated at least one home purchase or refinance in the 
   preceding year
   Federally insured or regulated




               HMDA Reporting
                        What Is Reported?




 Home Purchase loans
 Home improvements loans
 Refinance loans




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              Exemptions

Construction and temporary financing
Loans on Unimproved Land
Fiduciary Loans
Purchase of Interest in Mortgage Pool
Prequalification Requests
Purchase of Servicing Rights
Loans Acquired through a Merger or Acquisition




          HMDA Reporting
              Compliance  Challenges




Determining applicability to transaction, 
especially business loans
Accurately capturing and entering all data
Reconciling inconsistent data
Coordination among business lines




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        HMDA Worksheet
              Refer To Form




Type of property – covered dwellings
Purpose
  For refinance – additional information 
  requested
  Be sure to include this information




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  2012 HMDA Reporting Form

Overview of changes to form
 Date of Application – with ** new box to document 
 type of application
 Pre‐approval – we do not have a formal qualified pre‐
 approval program so answer is always N/A
 Type of Purchaser Loan – box in new location on right 
 side of form
 Reason for Denial – new box to document this 
 information




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Home Loan Government Monitoring 
   Information (GMI) Request
Collection of data at application
GMI data to be obtained on borrowers only –
not guarantors, trustees or signers for a 
business
If applicant chooses not to furnish the GMI, 
lender is required to note ethnicity, race and 
sex on the basis of visual observation or 
surname




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  Examples of Reportable Loans

 Denial of a home equity loan where the proceeds 
 were to be used for landscaping
 Business loan to purchase of a 10‐plex apartment 
 building that is secured by that building
 Mortgage loan where the proceeds are used to 
 payoff an existing mortgage loan and several other 
 debts
 Loan to purchase a rental house and is secured by 
 that house




Examples of Non‐Reportable Loans

  Home equity loan used to consolidate credit 
 cards
  Loan to purchase a vacant residential lot and 
  is secured by borrower’s primary residence
  Loan that is to purchase and is secured by 50 
  acres of agricultural land and a farm house
  Construction loan with no permanent     
 financing




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       New HMDA Data Fields

Credit Score                  Non‐fully amortizing 
Age                           payment terms
Total points and fees         Loan term (in months)
Prepayment penalty term       Origination channel
(in months)                   LO unique identifier
Real property value           Universal loan ID number
Introductory interest rate    Parcel ID number
period (in months)            Any additional data the 
                              Bureau determines




 Bureau Could Change By Rule

Format of reporting
Additional reporting of sold loans
Disclosure regarding loan purchaser class
Submission of underwriting criteria
Modification of credit scores, age or other 
fields to protect consumer privacy




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                                                      4/12/2012




         Where To Learn More

HMDA Resources
   http://www.ffiec.gov/hmda/default.htm
HMDA Analysis Reports
   http://www.ffiec.gov/reports.htm
Interagency Fair Lending Examination Procedures
   http://www.ffiec.gov/PDF/fairlend.pdf
HMDA Hearings
   http://www.federalreserve.gov/communitydev/hmda_
   hearings.htm




                                                            10
                    Home Mortgage Disclosure Act (HMDA) Worksheet
Use and distribution: Complete this form for every application involving the purchase, refinance or improvement of any residential property or
for a loan request secured by any type of residential property. After completion, forward the form to Loan Operations with the other required
loan documents. Include a copy of this completed form with the CIP documents emailed to the Compliance Department.

Officer: ___________________ Office/Market: _____________ Application or Loan Number: _______________

Loan Applicant(s): ___________________________________________________________________________

Type of Property:         1-4 Family    (Not manufactured housing)          Manufactured Housing                 Multifamily (5+ Units)

Other Information: _______________________________________________________________________________________________

Purpose   (see New Definitions*):    Home Purchase            Home Improvement             Refinance of a Consumer/Business Loan
If a refinance, complete the following:       Verify that a covered dwelling secured both the paid out loan and the new loan.
Address of residential RE securing paid off loan: _____________________________________________________________
Address of residential RE securing new loan: ________________________________________________________________
   Covered dwellings:                                                Covered loan applications:
      Primary and secondary residences                                 Home Purchase - Must be secured by a dwelling.
      Condominiums                                                     Home Improvement - May be secured or unsecured.
      Rentals                                                          Refinance - See *New Definitions below
      Mobile & manufactured homes (with or without land)             Important Fact: Loan does not have to be secured by
      Single family (1 to 4) or multifamily (5 or above) structures  same property being purchased, improved or refinanced.
   * NEW DEFINITIONS:
   • REFINANCE: a new obligation that satisfies and replaces an existing obligation by the same borrower in which both the
   existing obligation and the new obligation are secured by a lien on a dwelling-does not have to be the same dwelling; any
   lien status applies. Purpose of original loan does not matter.
   • MULTI-PURPOSE LOANS: If a loan is a home purchase loan and is also either a home improvement loan or a
   refinancing, report the loan as a HOME PURCHASE loan. If a loan is a home improvement loan as well as a refinancing,
   report the loan as a HOME IMPROVEMENT loan.
 
This Application is NOT HMDA reportable because (select all that apply):

        This application is for a Home Equity Line of Credit (HELOC) or a business purpose Line of Credit (LOC).
        This application is for a construction ONLY loan. (Exception: Construction-perm loans are HMDA reportable.)
        This application secured by residential property but is not for purchase, improvement or refinance of any property.
        This application is for pre-qualification purposes only. (No property identified & no written loan commitment issued)
        This application is for temporary financing (maturity 2 years or less and not fully amortizing during its term) and will
        be paid from permanent financing to the same borrower (i.e. not through sale of the dwelling).
        This application is for a temporary bridge loan and will be paid out in short term from sale of property.
        This is a refinance of a loan with a covered dwelling as collateral on only one of the loans.
        This is a partial participation purchased of a loan.
        This application is primarily for agricultural purposes (if for purchase or improvement, but not if for refinance)..
        This application is for the purchase of raw or vacant land.
        This application is for the purchase of a timeshare unit or other non-covered dwelling.
        This application for less than $500.
        Other: _______________________________________________________________________________________

              Conclusion: Please select one of the choices below and follow the appropriate instructions.

       This application is not HMDA Reportable. The person completing this form should sign and date in the space provided below.
Please have another staff member review the application and verify in the space provided below. Then forward this form to Loan Operations
with other application or loan documents. Include a copy of this completed form with the CIP documents emailed to the Compliance
Department.

       This application is HMDA Reportable. Please complete the HMDA Reporting Form. The person completing this form should sign
and date in the space provided on both forms. Have another staff member review the application and supporting documentation as well as
the HMDA Reporting Form, then verify by signing in the spaces provided. Include both completed forms with other application or loan
documents sent to Loan Operations. Include copies of HMDA forms with the CIP documents emailed to the Compliance Department.

Detailed information should be provided on the Loan Application/Credit Summary to support this conclusion.

Worksheet Completed by: __________________ Date: ________ Reviewed by:_____________________ Date:________
Reviewed by Loan Ops: _________________________ Date: ________ 
                                                                  HMDA Flowchart
                                  Start Here



                                                                            YES                                                                   YES
             Is the loan secured by and made for the purpose of                               Is the loan considered to be temporary
                           purchasing a dwelling*?                                         financing such as Bridge or Construction?

                                     NO                                                                         NO




                                                                            YES                    Is this a Line of Credit?                      YES
          Are any of the proceeds to be used for home improvement
                                                                                       (These may be optionally reported: Old Florida does
                   purposes (loan secured by a dwelling*)?
                                                                                                not report HELOCs or LOCs)
                                     NO                                                                         NO



                                                                                                         HMDA Applies:
                                                                                            Collect Borrower's Race/Sex/Ethnicity
                Are any of the proceeds to be used for home                 YES                     Complete Report Proof
                improvement purposes (loan not secured by a
           dwelling*) and will be classified as home improvement?
                                     NO




               Will the new loan be secured by a dwelling* and
                 replace and satisfy an old loan which is also             YES
                    secured by a dwelling*? (Refinance)
                                     NO




                                  HMDA Does Not Apply:
                   Do not Collect the Borrower's Race/Sex/Ethnicity
                             Do Not Report as a HMDA Loan




         * Dwelling means any residential structure regarless of the number of acres; number of units (4-plex, 8-plex, etc.); whether or not it is a primary
            dwelling, secondary home, or rental property; or the borrower entity (consumer, business, etc.). The term dwelling includes an individual
             condominium unit, cooperative unit, mobile home, manufactured home or an apartment building. The term does not include transitory
                                                      residences, such as, hotels, motels, dormitories, etc.




Banker's Compliance Consulting                                                                                                               Jan 2004
800-847-1653                                                                                                                                      150
                            HOME LOAN
             GOVERNMENT MONITORING INFORMATION REQUEST
The following information is requested by the federal government for certain types of loans related to a dwelling in
order to monitor the lender's compliance with equal credit opportunity, fair housing, and home mortgage disclosure
laws. You are not required to furnish this information, but are encouraged to do so. You may select one or more
designations for "Race." The law provides that a lender may not discriminate on the basis of this information, or on
whether you choose to furnish it. However, if you choose not to furnish the information and you have made this
application in person, under federal regulations the lender is required to note ethnicity, race, and sex on the basis of
visual observation or surname. If you do not wish to furnish the information, please check below.

APPLICANT                                                               CO-APPLICANT

Ethnicity                                                               Ethnicity
   Hispanic or Latino                                                      Hispanic or Latino
   Not Hispanic or Latino                                                  Not Hispanic or Latino

Race or National Origin (several may be selected)                       Race or National Origin (several may be selected)
  American Indian or Alaskan Native                                       American Indian or Alaskan Native
  Asian                                                                   Asian
  Black or African American                                               Black or African American
  Native Hawaiian or Other Pacific Islander                               Native Hawaiian or Other Pacific Islander
  White                                                                   White

Sex                                                                     Sex
  Male                                                                    Male
  Female                                                                  Female

   I do not wish to furnish this information.                                I do not wish to furnish this information.




______________________________________                                 _________________________________________
Applicant Signature                                                    Co-Applicant Signature

______________________________________                                  _________________________________________
Please print or type name                     Date                      Please print or type name                             Date

______________________________________________________________________________________________

For Bank Use Only: This information is to be requested during a face-to-face or telephone application for a HMDA reportable loan.
This information is to be obtained only from the actual individuals that are borrowers; do NOT collect info on business entity signors.

Application taken by:   Face-to-face Interview        Telephone       Mail

Noted Ethnicity: Applicant     Hispanic or Latino    Not Hispanic or Latino Co-Applicant      Hispanic or Latino   Not Hispanic or Latino

Noted Race: Applicant    Amer. Indian or Alaskan Native       Asian     Black    Native Hawaiian or Other Pacific Islander      White

         Co-Applicant     Amer. Indian or Alaskan Native      Asian      Black    Native Hawaiian or Other Pacific Islander     White

Noted Sex: Applicant    Male      Female   Co-Applicant    Male       Female

I hereby certify that I have noted this information based on visual observation or surname.

________________________________________ ____________________________________                    _______________________
Signature of Bank Employee                        Please print or type name of bank employee      Date
                    Send Copy of Completed Form to Compliance Department with the HMDA Reporting Form.
                      HMDA-1 Form - Effective 3-29-2011 Old Florida National Bank Compliance Department
                          2012 HMDA Reporting Form                                                                      
Office: _______________________________________                              Banking Officer: ______________________________________________
Applicant Name: ______________________________________________________________________________________________
Collateral Address (No PO Boxes): _______________________________________________________________________________
City/State/Zip: _______________________________                              County: _______________________
Loan/Application Number: _____________________                               Date Application Received (Enter N/A for purchased loans): ___/___/___**
Loan Type:                                                                   Gross Income – Borrower’s gross annual income relied on for credit decision – do not include
   (1) Conventional                                                          guarantor’s income. Use the 1040 Tax Return figure on line #22. (Mark N/A for the following: property
   (2) FHA Insured                                                           type is multi-family, borrower is a business entity such as a corporation or partnership, when no income
   (3) VA Guaranteed                                                         information is asked for or relied on in the credit decision, employee loan or purchased loan.)
   (4) Farm Service Agency/Rural Housing Service
                                                                                   N/A         $__________________________________
Property Type: (With or w/o land)
                                                                                                   Round to nearest 1,000 (500 rounds up!!)
  (1) 1-4 Family (Not manufactured housing
  (2) Manufactured Housing                                                   Type of Purchaser Loan:
  (3) Multi-Family (5+ units)                                                   (0) Loan not originated
**Use code 1 not 3 for loans on individual condo units                          (0) Loan NOT sold on the secondary market
                                                                                (8) Affiliate institution
Purpose of Loan:
                                                                                (9) Loan sold on the secondary market
    (1) Home Purchase
    (2) Home Improvement                                                     Reason for Denial:
    (3) Refinance                                                               (1) Debt-to-income ratio                (6) Unverifiable information
                                                                                (2) Employment history                  (7) Credit application incomplete
Owner Occupancy:
                                                                                (3) Credit history                      (8) Mortgage insurance denied
    (1) Owner Occupied (as principal dwelling)                                  (4) Collateral                          (9) Other ___________________
    (2) Not owner-occupied (2nd homes & rentals)
                                                                                (5) Insufficient cash
    (3) Not applicable (multi-family 5+ units)
                                                                                   (down-payment, closing costs)
Loan Amount (Applied for or granted):
                                                                             Rate Spread – Report for originated home purchase, refinance or dwelling-secured home improvement
$ _________________________________
                                                                             loans that ARE subject to Reg. Z.
  Round to nearest 1,000 (500 rounds up!!)
                                                                                 N/A – Loan was not originated
Pre-approval (home purchases only):                                              N/A – Loan not subject to Reg. Z
   (3) Not applicable                                                            N/A – Loan purchased
                                                                                 N/A – Home improvement loan not a dwelling secured
Action Taken:
    (1)   Loan originated                                                    If N/A is not selected, see HMDA Rate Spread Calculator at:
    (2)   Application approved but not accepted                              http://www.ffiec.gov/ratespread (Use the “new calculator”) and complete the following and put it
    (3)   application denied                                                 in the loan file:
    (4)   Application withdrawn before credit decision                       Rate Lock-in Date: _____/_____/______ (mm/dd/ccyy)
    (5)   File closed for incompleteness                                     APR (00.00%): __ __.__ __%
    (6)   Loan purchased by our bank                                         Term (See “calculator”): _______
Date Action Taken (Loan date or Notice date):                                Amortization Type:      Fixed  Adjustable
                                                                                  Reportable Spread: __ __.__ __%
                                                                                  N/A – Difference between the APR and the average prime offer rate is less than 1.5% for a first-lien
_____/_____/______ (mm/dd/ccyy)                                                  loan and less than 3.5% for a junior lien loan.
Property Location:                                                           HOEPA Status – APR Trigger: For 1st lien loan: APR at consummation exceeds yield on comparable
Include the FFIEC Geocode result page with this form.                        Treasury by 8 percentage points, or for junior lien loan: APR at consummation exceeds yield on
http://www.ffiec.gov/geocode/default.htm                                     comparable Treasury by 10 percentage points OR For both: Points and Fees Trigger: Points and fees
                                                                             exceed greater of 8 percent of “loan amount” or $611.00 for 2012.
MSA: ________________________ State: __________________
                                                                             To check rate refer to the H-15 at: www.federalreserve.gov/releases/h15/update
County: _________________ Census Tract: _________________                        (1) Loan originated or purchased that is subject to HOEPA because the APR or points & fees exceed
                                                                                     the HOEPA triggers.
Ethnicity (Govt. Monitoring Info must be obtained for individual borrowers       (2) All other cases are not subject to HOEPA
only):                                                                                    (1) The application did not result in a loan origination
Applicant/Co-Applicant                                                                    (2) The application is not applicable to Reg. Z because it was for business purpose, not
              (1) Hispanic or Latino                                                           made to a natural person, or was greater than $25,000 and was not secured by a
              (2) Not Hispanic or Latino                                                       dwelling or personal property used as a dwelling
              (3) Not Provided by applicant (mail, Internet, or phone                     (3) The application was or was to be unsecured or secured by something other than the
                                                                                               consumer’s principal dwelling
                 application)
                                                                                          (4) The application was for a residential mortgage transaction, i.e. a transaction where a
              (4) Not Applicable (business entities or purchased loans)
                                                                                               mortgage is created or retained in the consumer’s principal dwelling to finance the
              (5) No Co-Applicant                                                              acquisition or initial construction of that dwelling
                                                                                          (5) The application was for a consumer purpose reverse mortgage
                                                                                          (6) The application was for a consumer purpose open-end line of credit
Race or National Origin (Can select several from #1-5):                      Lien Status (originated loans & applications not originated):
Applicant/Co-Applicant                                                           (1) Secured by a first lien
              (1) American Indian/Alaskan Native                                 (2) Secured by a subordinate lien (second or third lien)
              (2) Asian                                                          (3) Not secured by a lien
              (3) Black or African American                                      (4) Not Applicable (purchased loan)
              (4) Native Hawaiian or Other Pacific Islander
              (5) White                                                      Application Type **
              (6) Not Provided by applicant (mail, Internet, or phone           Form 1003
                  application)                                                  Bank LAR
              (7) Not Applicable (business entities or purchased loans)         Commercial/Retail Loan Application
              (8) No Co-Applicant                                               Other _______________________

Sex:
Applicant/Co-Applicant                                                         Prepared by: __________________________________                      Date: _____/_____/______
              (1) Male
              (2) Female                                                       Verified by (Bank): _____________________________                    Date: _____/_____/______
              (3) Not Provided by applicant (mail, Internet, or phone
                 application)                                                  Verified by (Loan Ops): __________________________                   Date: _____/_____/______
              (4) Not Applicable (business entities or purchased loans)
                                                                               Certified by: ___________________________________                    Date: _____/_____/______
              (5) No Co-Applicant


                                                                                                                                      Revised December 7, 2011

								
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