Thread Options
#2197958 - 11/09/18 06:21 PM 500 partial exemption calculation - sold loans
dutchbltz Offline
100 Club
Joined: Oct 2015
Posts: 157
I'm working on determining if we are eligible for the partial exemption to the HMDA rules. We are so close to the threshold, that I need to be very precise in how it's calculated. I spoke to the CFPB about exactly how it was to be calculated 2 weeks ago, and they said it should be all closed end originations, regardless of whether they were reported (at that time) or not. It had nothing to do with reportability or LAR lines. Here's my question, which I did NOT ask her, but maybe someone else already did. And the answer to this will determine if we are exempt or not.

Do originations that we did, that we did NOT make the credit decision for (PHFA, for example) count into the 500? It was an origination, and it meets the closed end mortgage definition.... So I am inclined to say that yes, it counts. Thoughts?

Return to Top
HMDA

   
HMDA Academy
#2197965 - 11/09/18 06:43 PM Re: 500 partial exemption calculation - sold loans dutchbltz
Truffle Royale Offline

10K Club
Joined: Jul 2003
Posts: 17,285
The first prong of HMDA reporting has never changed.
The entity that makes the credit decision is the entity that reports the loan for HMDA.
Not a single loan we underwrite closes in my FI's name but I must report them all for HMDA because we make the credit decision.

Return to Top
#2197970 - 11/09/18 07:17 PM Re: 500 partial exemption calculation - sold loans Truffle Royale
dutchbltz Offline
100 Club
Joined: Oct 2015
Posts: 157
Hi Truffle - I understand that as far as reporting goes... we would not have, nor will we going forward, report these.... But my conversation with the CFPB rep led me to understand that reportability had no bearing on how the partial exemption was calculated - that it was solely based on 'originations'.... For example, applications that did not lead to an origination will not be counted towards the 500. Unfortunately I did not ask whether originations that we did not make the credit decision for still should be counted....

Return to Top
#2197980 - 11/09/18 07:59 PM Re: 500 partial exemption calculation - sold loans dutchbltz
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 77,275
Galveston, TX
You look at the originations on your last two year's of LARs and add any originated loans that were not reported in 2016-2017 that would have been required to be reported in 2018.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2198025 - 11/11/18 10:39 PM Re: 500 partial exemption calculation - sold loans dutchbltz
David Dickinson Offline
10K Club
David Dickinson
Joined: Nov 2000
Posts: 18,762
Central City, NE
If you didn't make the credit decision, so they wouldn't be on your LAR, do not count in the coverage test.

Randy: I agree, but you would need to take out new exemptions from the last 2 year's of LAR's. Ag refinance, for instance. Also, some would be lost in the new definition of "dwelling" (old mobile homes, houseboats, etc.).
_________________________
David Dickinson
http://www.bankerscompliance.com

Return to Top
#2198097 - 11/13/18 04:50 PM Re: 500 partial exemption calculation - sold loans dutchbltz
dutchbltz Offline
100 Club
Joined: Oct 2015
Posts: 157
Thanks all - I appreciate the feedback! Looks like we are going to squeeze in under the threshold then.

Return to Top
#2198148 - 11/14/18 03:14 AM Re: 500 partial exemption calculation - sold loans dutchbltz
SMQ, CRCM Offline

Power Poster
SMQ, CRCM
Joined: Apr 2001
Posts: 4,828
Between the lines
This can get very confusing, would it be safe to say
1. the bank should look at all of their loan originations for 2016 and 2017,
2. calculate how many they would have reported if they were using 2018 rules in 2016 and 2017?
_________________________
NOLA is my Beach!

Return to Top
#2198157 - 11/14/18 12:23 PM Re: 500 partial exemption calculation - sold loans dutchbltz
Adam Witmer Offline
Power Poster
Joined: Sep 2010
Posts: 2,572
1) Yes, but I would add that you only need to look at those originations secured by a "dwelling."
2) Yes.

Starting with all origination and a clean slate is the best approach and the only one I would use if I was extremely close to the threshold. That said, if your total number of dwelling-secured originations is less than 500, then there is no need to go to step 2.
_________________________
Adam Witmer, CRCM

All statements are my opinion, not those of my employer, and should not be taken as legal advice.
www.compliancecohort.com

Return to Top
#2198258 - 11/15/18 03:34 AM Re: 500 partial exemption calculation - sold loans dutchbltz
SMQ, CRCM Offline

Power Poster
SMQ, CRCM
Joined: Apr 2001
Posts: 4,828
Between the lines
Thanks for the confirmation.
_________________________
NOLA is my Beach!

Return to Top