Reporting “Action Taken” for HMDA

While the Action Taken data field may seem pretty straightforward on the surface, it’s actually one of the more confusing requirements in HMDA.  The regulation talks about “customary commitment or closing conditions” and “underwriting or creditworthiness conditions”.  In plain English, we refer to these as “property stuff” and “applicant stuff”.  These especially come into play with the “approve not accepted” code. 

David explains more in the video


HMDA Question: Collecting Demographic Information

We received the following HMDA question recently. It’s one we get asked a lot, so we thought we would share.

Question: If an application is filled out via internet, telephone, or mail, and the applicant does not provide information regarding ethnicity, race, or sex, what is the Bank’s responsibility (if any) in trying to gather this information?

Answer: For internet, mail, and phone applications, if the applicant marks the “I do not wish to provide” box (or indicates this verbally on a phone application) and leaves the ethnicity, race, and sex blank, then you do not have any further responsibility to collect that information even if you see them later on. You would report this as “information not provided by applicant in mail, internet or telephone application” on your LAR.

If the applicant does NOT mark the “I do not wish to provide” box and leaves the ethnicity, race, and sex blank, then you must attempt to collect the information if you see them face-to-face during the application process. So, if they come in prior to closing, you need to request the information again. This could be done on a separate collection form or on the application itself.  If the applicant marks the “I do not wish to provide” box at that time, you would collect on the basis of visual observation. If the only time you see them in person is at closing, you are not required to request/obtain the information at that time. You could do so but we recommend you don’t. While “application process” isn’t further defined, our opinion is it continues until you issue a Closing Disclosure, as applicable.

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HMDA Small Filer

If your institution is subject to HMDA, and you made between 100 and 500 closed-end loans in each of the prior two calendar years, you’re considered to be a “small filer”.  If your institution made more than 500 closed-end loans, you’re a “large filer”.  While you won’t necessarily find these terms in the Regulation, it’s our plain English way of distinguishing between those institutions required to report full HMDA data and those that can report limited HMDA data.

David explains more in the video.


HMDA: Loan Term vs. Line Term

If you are a HMDA bank, you know some of the data reporting requirements can be downright complicated and others just don’t seem to make sense.  One of the fields you will want to pay close attention to is the “Loan Term” field.  The term you report will differ depending on whether you have a closed-end loan or an open-end line of credit.

David explains the difference in the video.


Applicants for Joint Intent

A common area of confusion when it comes to the joint intent rules, is “who” is an applicant. 

Regulation B defines an “applicant” as any person who requests or who has received an extension of credit from a creditor, and includes any person who is or may become contractually liable regarding an extension of credit.

For purposes of…signatures under this section…, the term includes guarantors, sureties, endorsers, and similar parties.  To put it simply, an applicant is anyone who is or will be contractually liable but there are some ifs, ands, and buts. 

David explains more in the video

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