HMDA Refinance vs. Modification

When it comes to HMDA, a refinance is reportable, but a modification generally is not.  So, what’s the difference? HMDA defines a refinance in Section 1003.2(p), which states:  Refinancing means a closed-end mortgage loan or an open-end line of credit in which a new, dwelling-secured debt obligation satisfies and replaces an existing, dwelling-secured debt obligation by the same borrower.  The Commentary breaks this definition down even further.  A modification, on the other hand, isn’t really defined. It’s just not a refinance.  So, for HMDA purposes, you either have a refinance or you don’t.

Dave explains more in the video!


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