Optional Reporting & Partial Exemption

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    When the partial exemption rule came out last fall, we calculated that our 2017 closed-end mortgages would be just over the 500 threshold. We went back and checked those numbers to better document our position, and found that in fact, there are 490 closed-end mortgages for 2017 and 471 for 2016. There is some margin for error in those calculations since we are using system reports relying on collateral and purpose codes to try and determine which 2016-2017 originations would have been reportable under 2018 standards.

    In our situation, should we take advantage of the partial exemption? My understanding is that our software can easily accommodate that change by selecting that option. Or should we go ahead and report all fields for 2018?


    There are really two questions. Are you eligible for the partial exemption? And, if you are eligible, should you take advantage of the partial exemption?
    • First question. The conditions for determining eligibility are detailed on page 21 of the program materials.
    o It appears that you meet, just barely, the volume threshold. When a bank is that close to a threshold cutoff, based on my experience as an examiner, you can expect very detailed scrutiny of your calculation documentation. You want to very sure that your calculations are accurate.
    o We assume that you meet the CRA rating requirement.
    • Second question. We are big believers in the value of the expanded HMDA data. Whether you submit the full data or not it is available for your use. Once examiners are aware that you have collected the data they will most likely want access even if you choose not to submit the data. Not submitting the data shields the data from disclosure to the general public.

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