Upcoming Changes in the Home Mortgage Disclosure Act (HDMA)March 28, 2016
In October 2015, Regulation C – Home Mortgage Disclosure Act (HMDA) was amended and responsibility was transferred to the Consumer Financial Protection Bureau (CFPB). Changes for HMDA are coming in two phases, one in 2017 and one in 2018.
Changes include which institutions are subject to the regulation, the types of transactions we are required to collect, and the specific information that must be gathered. Generally the banks subject to the reporting requirements will be the same as in the past with the following changes.
Effective January 1, 2017, in order to be subject to the reporting requirements under HMDA you must originate at least 25 home purchase loans including refinances in the preceding two calendar years.
To be subject to HMDA effective January 1, 2018, you must originate at least 25 closed-end mortgage loans OR originate at least 100 open-end lines of credit secured by a dwelling in the preceding two calendar years.
Charts from the CFPB determining HMDA coverage can be found here:
All other changes will not occur until January 1, 2018. At that time changes will occur as to what transactions are reported and the data collected. Closed-end mortgages and open-end lines of credit secured by a dwelling will be reported. Unsecured home improvement loans will no longer be reported. Preapproval requests that are approved will also be reported.
Probably the biggest change will be the data collected that will include, in addition to the current data, age, credit score, automated underwriting information, unique loan identifier, property value, application channel, points and fees, borrower-paid origination charges, discount points, lender credits, loan term, prepayment penalty, non-amortizing loan features, interest rate, and loan originator identifier.
Other changes in 2018 include how monitoring information is documented, the submission of the information using a web-based tool, and the elimination of providing a disclosure statement to the public upon request (LAR will be available on CFPB website).
For more information, please contact Bill Pitt at 404-420-5641 or firstname.lastname@example.org.