HMDA Plus
By David Dickinson
In August, I wrote a blog about analyzing your HMDA data. Recently, the OCC announced they are introducing a pilot program ("HMDA Plus") too add more data to the HMDA-LAR. The ABA Washington Perspective (9/12/08) did a great job of summarizing this announcement, so I've simply provided their article below.
OCC To Launch 'HMDA Plus' To Obtain More Data on Fair Lending
The Office of the Comptroller of the Currency plans to launch a pilot program - known as HMDA Plus - with the largest national banks to test the feasibility and value of collecting additional information on loans to screen for fair-lending violations. The information would be gathered at the same time as lenders report for Home Mortgage Disclosure Act purposes.
Comptroller John Dugan made the announcement at an OCC-sponsored fair lending conference for bankers and regulators. He said that HMDA data alone is not enough to determine potential discrimination and can't be assessed by comparing simple denial rates or average rate spreads across racial groups.
Dugan said that the OCC has found that additional factors that are not part of HMDA reporting are needed for use in the later stages of the supervisory process.
The pilot program would bring those factors into the process much earlier, he said. Such additional factors would include loan-to-value ratios, credit scores and debt service ratios.
The program will be tested on larger banks with automated information systems, which smaller banks may not have. But Dugan cautioned smaller banks "it pays to be alert for potential application of statistical approaches to aspects of fair lending."
Staff Contact--Richard Riese (202) 663-5051.
On a related note, the FFIEC released the 2007 HMDA data last Friday. The Federal Reserve also issued an article that provides an analysis of the data. Don't forget to download the 2007 HMDA data and put it in your CRA public file. We recommend downloading the information to a CD and placing it in your CRA public file. If you print the entire document you are going to have a lot of paper that most likely no one is going to look at. 