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#2126185 - 04/13/17 04:55 PM
HMDA Clarification
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Central City, NE
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The CFPB just released 150 pages of Technical Corrections and Clarification to the 2018 rules. http://files.consumerfinance.gov/f/documents/201704_cfpb_NPRM_HMDA.pdfI'm doing quick scan and found this about Spec House builder loans: A home purchase loan does not include a construction-only loan or line of credit that is designed to be replaced by separate permanent financing extended to the same borrower at a later time or that is extended to a person exclusively to construct a dwelling for sale.YEAH!
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#2126223 - 04/13/17 07:49 PM
Re: HMDA Clarification
David Dickinson
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The Swamp
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That's the first thing I looked for. Construction -only. YAY!!!
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#2126228 - 04/13/17 07:56 PM
Re: HMDA Clarification
David Dickinson
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It's pretty plainly written, as well:
In addition, a loan secured by five or more separate dwellings in more than one location is a loan secured by a multifamily dwelling. For example, assume a landlord uses a covered loan to improve five or more rental property dwellings located in different parts of a town, and the loan is secured by those properties. The loan should be reported as secured by a multifamily dwelling.
Last edited by RR Joker; 04/13/17 07:57 PM.
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My opinion only. Not legal advice. Say you'll haunt me - Stone Sour
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#2126251 - 04/13/17 09:05 PM
Re: HMDA Clarification
David Dickinson
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I am so excited right now about the construction-only loans I am doing cartwheels...........in my head!
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#2126330 - 04/14/17 02:47 PM
Re: HMDA Clarification
David Dickinson
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I'm guessing banks won't be given the same leeway to correct LAR mistakes on the 2018 LAR that the CFPB has to put out the new regulation and correct it's mistakes as it goes. I'm just always amazed at the "typographical" errors (.97 for 97, for example) that they have to correct.
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#2126733 - 04/18/17 04:04 PM
Re: HMDA Clarification
David Dickinson
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Chillin an grillin
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Very relieved to see the clarification on multifamily(yay, I won't have to keep trying to explain this to our commercial lenders!!) and the construction loans, *whew* but in my mind they have planted a new fear in my brain with the disaggregated/aggregated thing. So we just leave the main category blank? I guess once the edits are available we can see if leaving it blank would create an edit.
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#2126762 - 04/18/17 05:23 PM
Re: HMDA Clarification
David Dickinson
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Personally, I think the multi-family definition is ridiculous. It flies in the face of any other multi-family definition in existence!
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My opinion only. Not legal advice. Say you'll haunt me - Stone Sour
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#2126776 - 04/18/17 05:53 PM
Re: HMDA Clarification
RR Joker
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out of the frying pan...
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Personally, I think the multi-family definition is ridiculous. It flies in the face of any other multi-family definition in existence! I agree. I'm grateful that they clarified what they actually want instead of leaving us guessing...but what they want makes no sense to me.
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#2126792 - 04/18/17 06:28 PM
Re: HMDA Clarification
David Dickinson
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Central City, NE
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^^^^^ Agree to Becca & Joker. bOaty said: So we just leave the main category blank? Correct. As M.C. Hammer said "Can't touch this". If the applicant selects any race (main or sub), you report exactly what they say. If they select any ethnicity, you report exactly what they say. Same with sex. Don't touch what they say. Therefore, if they mark a sub-race or sub-ethnicity, you transfer that info to the LAR and don't select a main category. However, if they don't select a race and/or ethnicity & you see them during the application process, you pick race(s) and ethnicity(ies) but can't choose subcategories. Its that simple. That's why the instructions to competing the Demo Info (Appendix B) is now 3 pages long!
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#2126801 - 04/18/17 07:06 PM
Re: HMDA Clarification
David Dickinson
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Thanks, David!
The thing that I like about multifamily is we do a lot of apartment lending and a good number of those are big complexes but each building is only four units. So if you have 150 units but they are all in a 4-plex, under the current rules we have to call those a 1-4 family which also makes no sense at all either.
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#2126817 - 04/18/17 07:39 PM
Re: HMDA Clarification
David Dickinson
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Joined: Sep 2004
Posts: 5,249
out of the frying pan...
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What makes my head hurt is them wanting to call 15 rental houses with individual addresses scattered across 3 counties (don't laugh, we have some like that) multi-family.
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#2126820 - 04/18/17 07:46 PM
Re: HMDA Clarification
David Dickinson
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Galveston, TX
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Hey, I'll take a rule that I might not agree with over ambiguity any day of the week when it comes to regulations.
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#2126821 - 04/18/17 07:50 PM
Re: HMDA Clarification
David Dickinson
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Agree.....as long as it's clear what they want, it doesn't matter to me if they want to have a field to report lawns with pink flamingos in the yard.
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#2126845 - 04/18/17 08:49 PM
Re: HMDA Clarification
David Dickinson
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Chillin an grillin
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Ssshhh! That might be the next thing they come up with!!!
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#2126869 - 04/18/17 10:09 PM
Re: HMDA Clarification
RR Becca
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New Jersey
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What makes my head hurt is them wanting to call 15 rental houses with individual addresses scattered across 3 counties (don't laugh, we have some like that) multi-family. So, for HMDA purposes, such a loan will be reported as a multifamily loan in 2018 and beyond. For CRA (Regulation BB), since the examiners always use HMDA data to evaluate the institution, will such loans also be considered multifamily loans?
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#2127328 - 04/20/17 06:34 PM
Re: HMDA Clarification
Sinatra Fan
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Joined: Dec 2000
Posts: 21,293
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What makes my head hurt is them wanting to call 15 rental houses with individual addresses scattered across 3 counties (don't laugh, we have some like that) multi-family. So, for HMDA purposes, such a loan will be reported as a multifamily loan in 2018 and beyond. For CRA (Regulation BB), since the examiners always use HMDA data to evaluate the institution, will such loans also be considered multifamily loans? At this point I would have to say no but I need to ponder that and all of its implications. I should look at the Call Report definitions.
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#2127343 - 04/20/17 07:12 PM
Re: HMDA Clarification
Kathleen O. Blanchard
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Joined: Dec 2000
Posts: 21,293
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What makes my head hurt is them wanting to call 15 rental houses with individual addresses scattered across 3 counties (don't laugh, we have some like that) multi-family. So, for HMDA purposes, such a loan will be reported as a multifamily loan in 2018 and beyond. For CRA (Regulation BB), since the examiners always use HMDA data to evaluate the institution, will such loans also be considered multifamily loans? At this point I would have to say no but I need to ponder that and all of its implications. I should look at the Call Report definitions. The Call Report has this to say about multifamily properties (and that is what drives loans to be reported as secured by multifamily properties for CRA and thus not small business or small farm). These are typical building/complex multifamily structures, not standalone 1-4 family properties. 1.d Secured by multifamily (5 or more) residential properties. Report (on the FFIEC 041, in column B; on the FFIEC 031, in columns A and B for large institutions and highly complex institutions – as defined for assessment purposes – with foreign offices, and in column B for all other institutions with foreign offices) all other nonfarm residential loans secured by real estate as evidenced by mortgages (FHA and conventional) or other liens that are not reportable in Schedule RC-C, part I, item 1.c. Specifically, include loans on: (1) Nonfarm properties with 5 or more dwelling units in structures (including apartment buildings and apartment hotels) used primarily to accommodate households on a more or less permanent basis. (2) 5 or more unit housekeeping dwellings with commercial units combined where use is primarily residential. (3) Cooperative-type apartment buildings containing 5 or more dwelling units. Exclude loans for multifamily residential property construction and land development purposes and loans secured by vacant lots in established multifamily residential sections or in areas set aside primarily for multifamily residential properties (report in Schedule RC-C, part I, item 1.a,(2)). Also exclude loans secured by nonfarm nonresidential properties (report in Schedule RC-C, part I, item 1.e).
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