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HMDA and Monitoring Information

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  • #2331
    Anonymous
    Inactive

    When our customer completed their loan application the first borrower was listed as the husband with borrower # 2 listed as the wife. The note was prepared the same: John Doe and Mary Doe. In our HMDA scrub we discovered when they signed the 1003 loan application and completed the monitoring information they signed as # 1 borrower, wife, # 2 borrower husband. Therefore the monitoring information says for HMDA LAR purposes codes Sex: 2,1 (i.e. female/male). This doesn’t match the note nor the application (page 1). Is this a problem? How should we report it on the LAR? ❓

    So sad when such trivial things are considered an error!

    #2682
    JGo9
    Participant

    Jestes,

    My bank doesn’t have to deal with HMDA report (and yes I’m happy about that) but I did a quick search and found some useful information on the FFIEC’s website. Here is a copy of the section that I think speaks to your issue:

    What do I do if I find an error in my HMDA data file after it has been submitted?

    Make the correction to your HMDA file and send in a complete resubmission; partial resubmissions should not be sent. See the data collection procedure change regarding data resubmissions. Refer to the next question, “How do I resubmit HMDA data?” for the resubmission guidelines.”

    Here is the link to the website as well: https://www.ffiec.gov/hmda/faqtech.htm#srs6

    I hope that helps!

    #2702
    Anonymous
    Inactive

    I think I mis-spoke. The error wasn’t found after the submission but in our post closing scrub that we do at end of each month. We can still fix it before it gets on the LAR to send to the regulators. I’m just not sure which is the correct answer. Do I go by the application and loan which lists the husband first and wife second (Sex: 1,2) or do I go by the monitoring information the customer signed which lists the wife first and husband second (Sex: 2,1) ?

    #2676
    JGo9
    Participant

    Jestes,

    OK I’ve done some more looking and honestly I don’t think I’ve been able to find a smoking gun for you, but here is my opinion and here is why.

    I think it should reflect the situation as is on the loan since the application lead to a loan being made. Granted either way you go, you should be sure that the information matches for the individuals. So whichever you report first you should be sure their personal infomation is always first. Whoever is in the second position be sure that their personal information is always listed seconde.

    I found this quote from the 2010 A Guide To HMDA Reporting (https://www.ffiec.gov/hmda/pdf/2010guide.pdf).

    Applicant Information
    Ethnicity, race, and sex of the
    applicant. Report ethnicity, race, and
    sex both for loans that you originate
    and for loan applications that do not
    result in an origination
    . At your option,
    you may report those data for loans
    that you purchase. Report the data
    for the applicant and for the coapplicant,
    if there is one. If there is no
    co-applicant, use the numerical code
    for “no co-applicant” in the “coapplicant”
    column. For more information,
    see Appendix A, I.D., Appendix
    B, and the staff comments to Regulation
    C § 203.4(a)(10).

    Here it makes a distinction between applicaitons and completed loans. Since the loan in issue sounds like it was actually funded I would tend to then that would be the driver in this case.

    Section 203.6 and in Jack’s 2010 Real Estate Lending Compliance Seminar book it says the following about Bona Fide Errors:

    An error is compiling or recording loan data is not a violation of the Act or the regulation if it was unintentional and occured despite the maintenance of procedures reasonable adapted to avoid such errors.

    I thought that might help you as well.

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