Now that you have filed your 2019 Home Mortgage Disclosure Act (“HMDA”) data, it is time to focus on 2020. The CFPB has issued the new 2020 Filing Instructions Guide (“FIG”) for submissions and data collection which can be found on the FFIEC website. The 2020 updates incorporate changes to the HMDA Rule issued by the Consumer Financial Protection Bureau in October 2019. The 2020 FIG can be found at https://www.ffiec.gov/hmda/guide.htm
While there are no substantial changes as to how you compile and submit your data, it is important to point out that we are seeing regulators requiring resubmissions and rescrubbing of HMDA data if it is not completed correctly. If you struggled with compiling and scrubbing last year’s HMDA data, Regulatory Solutions is here to help. Using our proprietary HMDA software, we compare your source documents in the loan file to the data points recorded on the HMDA LAR and provide you with an exception report detailing data points which need correction. Contact us today to begin your 2020 HMDA LAR Data Scrub.
The Federal Financial Institutions Examination Council (FFIEC) issued the 2020 “A Guide To HMDA Reporting: Getting it Right!”. This guide is to be used for HMDA Submissions due March 1, 2021. Regulatory Solutions, using its proprietary HMDA Software, has scrubbed over 9,000 HMDA loans/applications for financial institutions comparing the data on their 2019 and 2018 HMDA LARs to source documentation. Do not wait until 2021 to begin your HMDA scrub, contact Regulatory Solutions today. Let us provide your HMDA scrubs on either a monthly or quarterly basis so next year you will be ready to submit your HMDA LAR. The 2020 “A Guide To HMDA Reporting: Getting it Right!” can be accessed at https://www.ffiec.gov/hmda/guide.htm
The Consumer Financial Protection Bureau (“CFPB”) has published an updated HMDA Small Entity Compliance Guide. You can access the updated guide at https://www.consumerfinance.gov/policy-compliance/guidance/hmda-implementation/.
Regulatory Solutions specializes in helping you scrub your HMDA data to ensure the data you are submitting on your HMDA LAR is correct. Contact us to discuss how we can assist you in this process. Read more here >
The CFPB recently issued a consent order against Freedom Mortgage Corporation for HMDA violations. These violations mainly revolved around the collection and reporting of applicant’s demographic information and spanned four years of HMDA reporting. Specifically, the Corporation was found to have violated Regulation C by:
- Selecting non-Hispanic white for the applicant’s race and ethnicity if the applicant did not provide the information for applications taken over the phone, regardless of the accuracy of the information.
- For applications taken over the phone, they misreported the applicant’s ethnicity and race as non-Hispanic white even when the applicants provided different information.
- Rather than addressing an internal system issue that would eliminate certain information if the applicant’s sex was not provided, the Corporation selected a sex for the applicant regardless of the accuracy.
None of the errors made by the Corporation were considered to be bona fide errors as allowed by Reg C. 1003.6(b)(1) which states that a bona fide error is an error in compiling or recording data that was unintentional and occurred despite procedures in place to avoid such an error. Among other orders, the Corporation was ordered to develop and maintain new policies and procedures to ensure accurate collection and reporting of their HMDA data. They also must pay a $1.75 million civil money penalty for these violations.
Regulatory Solutions has developed proprietary software to scrub and verify the data in your HMDA LAR. Please contact us today to discuss how we can help you to ensure that your HMDA data is correct.
Now that you have filed your 2018 Home Mortgage Disclosure Act (HMDA) data, it is time to focus on 2019. The CFPB has issued the new Filing Instructions Guide (FIG) for submissions and data collection which can be found on the FFIEC website. The only major change to the new HMDA FIG 2019 is that it now includes the new values for the data points that were exempted under the Economic Growth, Regulatory Relief, and Consumer Protection Act that went into effect in May 2018. The HMDA FIG 2019 can be found here: https://ffiec.cfpb.gov/
While there are no substantial changes as to how you compile and submit your data, it is important to point out that 2019 is the first year that the CFPB will assess penalties under the revised HMDA regulation. If you struggled with compiling and scrubbing last year’s HMDA data, Regulatory Solutions is here to help. Using our proprietary HMDA scrub software, we compare your source documents in the loan file to the data points recorded on the HMDA LAR and provide you with an exception report detailing data points needing correction. Contact us today to being your 2019 HMDA LAR Data Scrub.
Have you revised your Quality Control Program yet to meet the new reporting requirements for HMDA? If not, it could play a part in your ability to sell loans to certain government agencies. FHA in particular requires that a lender’s Quality Control Program be compliant with the Home Mortgage Disclosure Act’s reporting requirements. The Quality Control Program should ensure that the information you are reporting is accurate and that the report itself is not only correct but is made timely. With the passing of the new HMDA regulation which became effective at the beginning of 2018, and for those lenders that became exempt from reporting the expanded data fields with the passage of the Economic Growth, Regulatory Relief, and Consumer Protection Act, you should ensure that your current Quality Control Program has been revised to meet the applicable HMDA reporting requirements.
At Regulatory Solutions, we provide services to meet all of your HMDA needs. We are capable of not only ensuring that your Quality Control Program meets the reporting requirements for federal agencies and federal regulations, but can also perform full HMDA scrubs.
Did you know that your HMDA data plays an important role when you are selling your loans to various agencies?
Most agencies require the lender to submit various HMDA data points as part of the purchasing process. With the new HMDA regulation that just took effect in January 2018, this means that the expanded GMI will play a key role in the purchasing process for most agencies. Freddie Mac in particular specifically requires the lender report the GMI, Rate Spread, and HOEPA information for each loan that Freddie Mac purchases.
Fannie Mae, FHA, and Rural Housing require more than just the reporting of HMDA data points. Before these agencies will consider purchasing loans from your institution, you must show that you have procedures in place and are complying with the current HMDA regulation as part of your Quality Control Program. FHA has an additional requirement that the HMDA information that is being reported be accurate.