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The world of HMDA is changing in a dramatic fashion. On October 13, 2015 the Consumer Financial Protection Bureau (CFPB) published 797 pages of final rules to implement changes required by the Dodd-Frank Wall Street Reform and Consumer Protection Act and changes from the CFPB that are intended to modernize and simplify the reporting requirements. The final rules are generally effective on January 1, 2018, but changes begin with the 2017 HMDA data.
The final amendments to Regulation C modify the types of institutions and transactions subject to the regulation, the types of data that institutions are required to collect, and the processes for reporting and disclosing the required data.
As we begin the countdown to the effective date we are offering a two-part series to assist your efforts to implement the new rules.
Part 1 – Scope, Covered and Exempt Transactions
Part 2 – Completing the Revised Loan Application Register
Part 2 of this series provides a thorough review of the revised Regulation C rules that explain, in detail, the information that must be included on the revised loan application register (LAR). The two-hour program assures participants:
• Understand the new requirements;
• Have a plan to implement the new requirements; and
• Are aware of potential problems resulting from the new requirements.
Participants receive a detailed manual that serves as a handbook long after the program is completed.
The program provides:
- Detailed information on how to complete the LAR. The reportable data, expanded from 23 to 48 data points, include:
- Information about applicants, borrowers, and the underwriting process, such as age, credit score, debt-to-income ratio, and automated underwriting system results.
- Information about the property securing the loan, such as construction method, property value, and additional information about manufactured and multifamily housing.
- Information about the features of the loan, such as additional pricing information, loan term, interest rate, introductory rate period, non-amortizing features, and the type of loan.
- Certain unique identifiers, such as a universal loan identifier, property address, loan originator identifier, and a legal entity identifier for the financial institution.
- Each field is reviewed and its potential impact on fair lending, CRA or other areas is considered.
- Information regarding amendments related to the collection of ethnicity, race, and sex of applicants and borrowers. The final rule:
- Requires financial institutions to report whether ethnicity, race, or sex information was collected on the basis of visual observation or surname when an application is taken in person and the applicant does not provide the information; and
- Permits applicants and borrowers to self-identify using 15 new subcategories for transactions where ethnicity and race information is provided by the applicant or borrower.
- A review of the 2017 and 2018 Filing Instructions Guide (FIG) (published July 2016);
- Steps to identify and eliminate reporting errors and thereby avoid penalties and
- Highlights of proposed amendments to Regulation C that were released on April 13, 2017.
The program is designed for loan officers, compliance officers, loan processors and clerks and auditors. Whether new to the requirements of HMDA and Regulation C or a seasoned veteran, this program provides a comprehensive review of the new requirements of HMDA and Regulation C.
To access Part I of this webinar series, HMDA Part 1 – Scope, Covered and Exempt Transactions Webinar Recording, click here.