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HMDA Reporting for Bank That Sells All Loans
Answer by David Dickinson, BOL Guru
Guru BIOS
Question: HMDA Question. The secondary market division of our bank sells 100% of the loans it originates. We collect the application, arrange for the title work, order the appraisal, and we close the loan in our name with our money. Who is responsible for HMDA reporting? I know it is the entity that makes the credit decision. We have felt like the investor makes the credit decision and so they report the loans they make and decline. However, we send the adverse action notice. I am hearing from others that both report. It seems to me that if we are comforatble not being part of the credit decision, then we are not responsible for HMDA reporting of loans that eventually are originated or declined.
Answer: You are right that the decision maker is the one that reports. HMDA does not want a double reporting. I would contact your investor and ask them if they report. One of you must. Be sure to document your findings.
First published on BankersOnline.com 1/5/04
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