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#2080537 - 05/26/16 01:11 PM Re: Final Rule Issued Kathleen O. Blanchard
swiggles Offline
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Quote:
Well, we are all in this together! It will be exciting (in one way or another!)


....I'm not sure the term "exciting" is an accurate description. I can think of other, better choice words for the upcoming mess. wink
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#2080609 - 05/26/16 03:33 PM Re: Final Rule Issued TMatt87
RR Becca Offline
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out of the frying pan...
I think "horrifying" might be closer to what you're looking for there. wink
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#2080617 - 05/26/16 03:46 PM Re: Final Rule Issued TMatt87
Cheli Offline
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They said that about TRID too...I don't know about other FI's, but it left mine with some very deep scars. We're in the process of rebuilding relationships :-( One of our attorneys stated 2 weeks ago, that this will be 8 times worse than TRID. IS that even possible?

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#2080634 - 05/26/16 04:13 PM Re: Final Rule Issued TMatt87
Adam F Offline
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As being the one person in my institution responsible for reviewing and scrubbing the HMDA LAR, I feel it will be 100 times worse than TRID. smile
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#2080645 - 05/26/16 04:40 PM Re: Final Rule Issued TMatt87
Kathleen O. Blanchard Offline

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I truly feel that one person HMDA processes will no longer work unless there is an exceedingly small LAR. Even then, the time involved will be much more extensive. Similar to TRID audits, the time will grow exponentially.
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www.kaybeescomplianceinsights.com

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#2080646 - 05/26/16 04:41 PM Re: Final Rule Issued TMatt87
Kathleen O. Blanchard Offline

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And please prepare. Do not wait until late in 2017, or worse, until you start to enter loans on a 2018 LAR, to study how to complete each field. It is complex.
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www.kaybeescomplianceinsights.com

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#2080708 - 05/26/16 07:08 PM Re: Final Rule Issued TMatt87
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I think this will be much, much worse than TRID...

Our LAR is going to grow from about 1700 items to an estimate 5000.... Hope the departments get qualified HMDA staff because there is no way in [censored] this can fall on compliance's shoulders.

I think banks will be getting raked over the coals on this for the next decade. Havent heard anything about a grace period or changed permissible error percentage. If you fail an exam youll be scrubbing ALL of the new loans and ALL of the new fields. I cant even imagine. Might be very nice to be a consultant over the next 10 years haha.
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#2080710 - 05/26/16 07:12 PM Re: Final Rule Issued TMatt87
raitchjay Online
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OK
Makes me groan every time i realize that the only reason we're a HMDA reporter is the one (very small compared to other MSAs) MSA we have a branch in, which accounts for maybe 15% of our LAR. The other 85% of our LAR entries are in areas that would, on their own, never make it onto a LAR because they're outside of an MSA.
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#2080765 - 05/26/16 09:37 PM Re: Final Rule Issued TMatt87
Kathleen O. Blanchard Offline

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I hate to say this, but I for one do not understand the reason for an exemption for financial institutions without an office in an MSA. I know of banks that, were it not for the lack of an office in an MSA, would have a LAR of several hundred entries. Given that part of the reason for HMDA is knowing what is going on with housing and the loans to finance housing, this makes no sense.

Good lobbying by someone, I guess.
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www.kaybeescomplianceinsights.com

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#2080767 - 05/26/16 09:44 PM Re: Final Rule Issued TMatt87
raitchjay Online
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OK
I do agree with that KB....never really made sense to me either.
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#2080769 - 05/26/16 09:46 PM Re: Final Rule Issued TMatt87
Kathleen O. Blanchard Offline

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It would make more sense to raise the threshold and eliminate the MSA rule. But you never heard me say that.
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Kathleen O. Blanchard, CRCM "Kaybee"
HMDA/CRA Training/Consulting/Mapping
The HMDA Academy
www.kaybeescomplianceinsights.com

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#2080772 - 05/26/16 09:53 PM Re: Final Rule Issued TMatt87
raitchjay Online
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OK
I would like that change. Maybe that would exempt us (but i doubt it).
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#2080775 - 05/26/16 10:23 PM Re: Final Rule Issued TMatt87
TMatt87 Online
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I'm a one person HMDA show with a LAR estimated to be about 1500 by 2018. It would probably be manageable if that we my sole responsibility, but I'm also the TRID guy, and the CRA guy and the Flood Insurance guy, and..... Should be fun.
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#2080796 - 05/27/16 12:49 PM Re: Final Rule Issued Kathleen O. Blanchard
Sinatra Fan Offline
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Originally Posted By Kathleen B
And please prepare. Do not wait until late in 2017, or worse, until you start to enter loans on a 2018 LAR, to study how to complete each field. It is complex.


I absolutely agree with Kathleen on this. I've already started educating the commercial loan department on HMDA itself. They really had no idea it affects multifamily, investor-owned residential, and mixed-use with a majority residential use loans. As I did with TRID, I've started putting out little bulletins about the HMDA changes to the entire lending staff.

My biggest concern is with the commercial area. On the residential side, we will be capturing the required information through our LOS. The commercial side does not use an LOS, so I'm trying to figure out how to automate capture of the data.
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#2080809 - 05/27/16 01:26 PM Re: Final Rule Issued TMatt87
Kathleen O. Blanchard Offline

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I also advise providing the full list of what will be required to report so that product areas (like residential, commercial, etc.) can begin to determine just where that data is housed and consider how it will be gathered to get into the LAR.

While an overworked compliance officer might feel they do not have time to start to learn the new HMDA rules, it would be unfair to not advise these product areas until the last minute that they will need to gather more data to complete the LAR.

What is the needed information?
Where is it housed?
Is it in a system or a paper document?
If in a system how, will it get to the LAR?
If paper, how will it be gathered to get to the LAR?
If different systems are involved, what are the vendors doing to prepare for HMDA?

Preparing for the new HMDA is not a one person show so at least educate others on what is needed, let alone the rules on what and how to report.
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Kathleen O. Blanchard, CRCM "Kaybee"
HMDA/CRA Training/Consulting/Mapping
The HMDA Academy
www.kaybeescomplianceinsights.com

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#2085496 - 06/27/16 10:07 PM Re: Final Rule Issued TMatt87
awilli Offline
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Based on what I understand, we start collecting, per the new rule, on 1/1/2018. Is this based on loan applications received on or after 1/1/2018?

For example, what if we have an application in December 2017, but the loan doesn't get approved and closed until 2018?
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#2085497 - 06/27/16 10:19 PM Re: Final Rule Issued TMatt87
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It is based on action date, so if you start an application in 2017 but it doesn't reach final action until 2018, you will have to report on the 2018 LAR under the new rules. The one exception is the ethnicity, race, and sex information. For applications started in 2017, it will be reported in the same way as it is currently reported (no sub-categories).
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#2085711 - 06/28/16 08:02 PM Re: Final Rule Issued TMatt87
JobSecurity Online
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Will there be a 2018 HMDA topic opened in the Dodd-Frank area of the forum? Just starting to dig in and would like to see a specific area for these implementation questions rather than in this large final rule thread. It is going to be a long year and a half frown

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#2085718 - 06/28/16 08:15 PM Re: Final Rule Issued TMatt87
raitchjay Online
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OK
Originally Posted By TMatt87
It is based on action date, so if you start an application in 2017 but it doesn't reach final action until 2018, you will have to report on the 2018 LAR under the new rules. The one exception is the ethnicity, race, and sex information. For applications started in 2017, it will be reported in the same way as it is currently reported (no sub-categories).


Matt....i'm not very far along yet on this......where is the citation or interpretation that applications started in 2017, but closed in 2018, will have the GMI reported per 2017 rules? Thanks.
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#2085736 - 06/28/16 08:39 PM Re: Final Rule Issued TMatt87
TMatt87 Online
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This is from the small entity guide:

Because the 2015 HMDA Rule changes the information that must be included on an Application form or other collection form, Financial Institutions must revise their forms. A Financial Institution must use the revised collection or Application form for Applications received on or after January 1, 2018. For Applications received prior to January 1, 2018, the Financial Institution does not use the revised collection form, but collects applicant information using a collection form that complies with the Regulation C requirements in effect prior to January 1,2018. The 2015 HMDA Rule provides a transition provision that allows a Financial Institution to report the applicant’s ethnicity, race, and sex required under the Regulation C requirements in effect at the time that the Financial Institution collects the information, not when the Financial Institution takes final action on the Application. Comment 4(a)(10)(i)-2.
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#2085743 - 06/28/16 08:46 PM Re: Final Rule Issued TMatt87
TMatt87 Online
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And this from the final rule, page 739:

2. Transition rule for applicant data collected prior to January 1, 2018. If a financial
institution receives an application prior to January 1, 2018, but final action is taken on or after
January 1, 2018, the financial institution complies with § 1003.4(a)(10)(i) and (b) if it collects
the information in accordance with the requirements in effect at the time the information was
collected. For example, if a financial institution receives an application on November 15, 2017,
collects the applicant’s ethnicity, race, and sex in accordance with the instructions in effect on
that date, and takes final action on the application on January 5, 2018, the financial institution
has complied with the requirements of § 1003.4(a)(10)(i) and (b), even though those instructions
changed after the information was collected but before the date of final action. However, if, in
this example, the financial institution collected the applicant’s ethnicity, race, and sex on or after
January 1, 2018, § 1003.4(a)(10)(i) and (b) requires the financial institution to collect the
information in accordance with the amended instructions.
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#2085750 - 06/28/16 08:56 PM Re: Final Rule Issued TMatt87
raitchjay Online
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OK
Thank you TMatt.
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#2085815 - 06/29/16 12:17 PM Re: Final Rule Issued TMatt87
David Dickinson Offline
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To summarize: It depends on when you collect the demographic data. If in 2017, follow today's rules. If in 2018, follow the new rules. It doesn't matter what the action date is.
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#2086075 - 06/30/16 01:36 PM Re: Final Rule Issued TMatt87
Kathleen O. Blanchard Offline

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It is important to understand the reason for treating the demographic (GMI) data differently. HMDA is an exception to the prohibition on asking applicant's race, ethnicity and gender information. Right now, we are authorized to ask the questions under current HMDA rules.

The expanded exception to ask for the additional data is not authorized until 1/1/2018.

All of the new HMDA is based on action date with this transition rule for GMI data due to the legalities involved in requesting the data.
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#2094630 - 08/22/16 09:48 PM Re: Final Rule Issued TMatt87
George Offline
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I am little late to this party, but quick question: does anybody know, or think, if a new GIR will be issued? Also, regarding the link that started this thread, is that the best place to look to find the changes (or summary of) taking place? I am going cross-eyed trying to read through it!

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