HMDA 2018 Requires Reporting Of Total Dwelling Units
When reporting your HMDA data in 2018, you will now have to report the total number of individual dwelling units for the property that is securing the loan. This data point will always be answered with a number as this is one of the few data points where “not applicable” cannot be reported. When you are dealing with an application that did not end in origination, then the institution should rely on the best information that was available at the time action was taken.
When the loan is secured by a manufactured home community, the data point should include the total number of manufactured home sites that can be occupied. It does not matter if the units are already occupied when you are reporting this data point. When you are reporting on a loan that is secured by only one manufactured home and it is located in a manufactured home community, then this data point should be listed as being “1”.
If the loan is secured by a condominium, then the total number of individual units should be reported on your HMDA LAR. If such things such as manager apartments, vehicle pads, site-built homes, or other rental spaces are considered under the financial institutions underwriting guidelines, then they should also be included in the total of units.
For more information on HMDA regulations, 2018 data point changes or our HMDA compliance services, please call Rhonda Wannemuehler or Betsy Reynolds at 855-734-7655.
Manufactured Home Secured Property Type & Manufactured Home Land Property Interest
Beginning in 2018, a financial institution will report manufactured home information as part of their HMDA data. Specifically, the secured property type and the land property interest information should be reported in regards to the manufactured home that is securing the loan.
For the secured property type, a financial institution will have to report whether the loan is secured by a manufactured home and land or if the land is not securing the loan. A financial institution will report that the Manufactured Home is not secured by land even if the Manufactured Home is considered real property under state law.
For the land property interest, the financial institution should report the information about the applicant’s ownership interest in the land where the manufactured home is located. The first option that can be reported is direct ownership. This is used when the applicant has direct ownership in the land and the ownership is more than a possessory real property ownership interest. Another option is indirect ownership. This is reported when the applicant is a member of a resident-owned community that is structured as a housing cooperative which owns the underlying land. If the applicant lives in a resident-owned community but is not a member, the land property interest would be reported as a paid leasehold. A paid leasehold can occur when the applicant does not have an ownership interest in the land but they have a written lease for the lot that specifies rent payments. This data point can also be reported as an unpaid leasehold. This occurs when there is no written lease and therefore no agreement for rent payments.
There is an additional circumstance for the land property interest data point. This will be reported as “not applicable” if the location for the manufactured home has not yet been identified at the time action was taken. When it comes to reporting these data points as “not applicable” on your HMDA LAR, there is some overlap. Both of these data points will be reported as “not applicable” when the dwelling that is securing the loan is not a manufactured home or if it is a manufactured home community that is a multifamily dwelling.
For more information on HMDA regulations, 2018 data point changes or our HMDA compliance services, please call Rhonda Wannemuehler or Betsy Reynolds at 855-734-7655.
Debt-to-Income Ratio New HMDA Reporting Requirement
Another addition to what must be collected as part of your HMDA data in 2018 is the borrower’s debt-to-income ratio. This must be reported if the DTI ratio was relied upon when the financial institution made their credit decision. This does not mean that in order for this data point to be reportable it had to be a deciding factor when the financial institution made their credit decision. The DTI ratio merely had to have been considered during the credit decision process.
On your HMDA LAR, this data point can be reported as being “not applicable” in a number of circumstances. One instance is if the DTI ratio was not relied upon when the credit decision was made. “Not applicable” can also occur when you are reporting on a purchased loan and for applications that were closed for incompleteness or withdrawn before a credit decision could be made. Another occasion where “not applicable” is reported on your HMDA LAR is when the applicant and the co-applicant are not natural persons. It is important to note that when reporting the DTI ratio, what is securing the loan will also affect what you report on your HMDA LAR. When the loan is secured by a multifamily dwelling, this data point should be reported as “not applicable”.
For more information on HMDA regulations, 2018 data point changes or our HMDA compliance services, please call Rhonda Wannemuehler or Betsy Reynolds at 855-734-7655.