2017 HMDA Reporting Changes and Beyond

In July 2014, the Consumer Financial Protection Bureau proposed amendments to Regulation C – Home Mortgage Disclosure Act that require collection, recording and reporting of additional information to further the Act’s purposes and to modernize the manner in which covered institutions report the data. 

On October 15, 2015, the final rule was issued amending Regulation C, which changed the following:

  • Types of institutions subject to Regulation C;
  • Types of transactions subject to Regulation C;
  • Specific information that covered institutions are required to collect, record and report; and 
  • Processes for reporting and disclosing data.

Who is Covered?

Effective January 1, 2017, all financial institutions (bank, credit unions and savings associations) must meet the (i) asset size, (ii) location, (iii) federally related and (iv) loan activity tests under the current Regulation C rules.  In addition, financial institutions must have originated at least 25 home purchase loans, including refinances of home purchase loans during both of the 2015 and 2016 calendar years. 

Therefore, if your financial institution met all four tests noted above but did not originate at least 25 home purchase loans, including refinances of home purchase loans during both 2015 and 2016; your financial institution is not subject to the collecting, recording and reporting requirements for the current 2017 calendar year.

Effective January 1, 2018, all financial institutions will be subject to Regulation C if they meet all of the four applicable coverage tests and originated at least 25 covered closed-end mortgage loans or 100 covered open-end lines of credit in each of the two preceding calendar years. 

Covered Transactions, Reportable Data and Data Submission

Changes to the types of transactions, the specific information that must be collected and reported, and the process for submitting the data will also take effect on January 1, 2018.

Making a Determination and How to Proceed

For now, financial institutions must first determine whether collection of the required information is mandatory for 2017.  If so, the collection and reporting process remains the same with no other significant changes. 

However, if you find that your financial institution is not subject to Regulation C in 2017, here’s a friendly reminder that all financial institutions are subject to collection of applicable government monitoring information under the current rules of Regulation B – Equal Credit Opportunity Act. 

Regulation B requires the collection of the applicant’s ethnicity, race, sex, marital status and age on all requests for credit primarily for the purchase or refinancing of a dwelling occupied or to be occupied by the applicant(s) as a principal dwelling and where the extension of credit will be secured by the dwelling.  

Getting Prepared for Additional Reporting Requirements

In order to be prepared for the additional reporting requirements in 2018, extensive training must be provided to all applicable staff and policies/procedures and systems must be amended to address the new requirements.