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.

Get answers to more of your questions through our many tools.

Published
2021/04/13

Share This