under the new rules, we will be exempt as we fall under the originated loans for the past two years. However will we be required to complete a record of loans to comply with the Fair Housing Home Loan Data System 12 cfr 27 since HMDA will not apply to us now?

You are going to have to continue counting your loans to make sure you remain exempt from HMDA anyway, so I do not see this as being much of a burden:

(2) A bank that receives 50 or more home loan applications a year, as measured by the previous calendar year, and that is not required to collect data under paragraph (a)(1) of this section, shall record and maintain for each decision center the following information on home loan activity:

(i) Number of applications received for each of the following: Purchase; construction-permanent; refinance.

(ii) Number of loans closed for each of the following: Purchase; construction-permanent; refinance.

(iii) Number of loans denied for each of the following: Purchase; construction-permanent; refinance.

(iv) Number of loans withdrawn by applicant, for each of the following: Purchase; construction-permanent; refinance.

For national banks, the FHHLDS requires you to keep records when you have 50 or more home loan applications during the prior calendar year. It's more than just the general count, but it is typically the information you'll get on the URLA. See Part 27, specifically 27.3. https://www.law.cornell.edu/cfr/text/12/27.3

I'm not sure if you have the apps there is a way out. Maybe if the OCC sees a big increase in these they'll update it.

I am confused Andy - what more does a typical OCC regulated entity have to do over and above the quotation that I provided from 27.3?

They have to collect data, which is generally all or mostly on the URLA and complete the FHHLDS form which is LAR-like (or an old outdated substitute) or if the volume is really low, monitor apps to see when they may have to start keeping records.

Here is an excerpt from some of my old teaching materials.

• National banks not subject to HMDA that received 50 or more home loan applications during the previous calendar year may choose either of the two recordkeeping systems:
o Maintain HMDA-like records, or
o Record and maintain for each decision center, using the Monthly Home Loan Activity Format,
- the number of applications received
- the number of loans closed
- the number of loans denied
- the number of loans withdrawn

• The information must be updated within 30 days or each calendar, quarter end. (This is similar to the OCC HMDA requirement and predates the HMDA requirement itself.)

• A national bank that is exempt from coverage (has fewer than the 50 loans required) will be covered for the next month following any quarter in which it receives an average of more than four home loan applications per month. It will be exempt again after two consecutive quarters of receiving four or fewer home loan applications in each quarter.

• The OCC may require a bank to maintain this log if it suspects a discriminatory practice.

• Information to be maintained includes the following:
o Application information including:
- date of application
- type of loan (purch, constr-perm, refi)
- any government insurance and type
- is it an application or inquiry
- case number
- race/national origin
- property location (complete street address and census if located in one in which the bank has an office)
o If an appraisal is completed:
• The appraised value; and
• The census tract number, where available, for those properties that are in a Metropolitan Statistical Area (MA) in which the bank has a home office or branch office.
o Disposition of loan application using the following categories:
• Withdrawn before terms were offered;
• Withdrawn after terms were offered;
• Denied;
• Terms offered and accepted by applicant(s).
o If final terms are offered, whether or not accepted:
• The loan amount.
• Whether private mortgage insurance is required, and if so, the terms of the insurance.
• Whether a deposit balance is required, and if so, the amount.
• The note (simple) interest rate.
• The number of months to maturity of the loan offered.
• Points.
• Commitment date.
o The type of mortgage using the following categories:
• Standard Fixed Payment;
• Variable Rate;
• Graduated Payment;
• Rollover;
• Other.
o The name or identification of the bank office where the application was submitted.
o Whenever credit is denied, copy of the Equal Credit Opportunity Act credit notice and statement of credit denial.
o Any additional information used by the bank in determining whether or not to extend credit, or in establishing the terms.
• The information must be logged and maintained, but is only submitted upon request from the OCC. It must be available to the OCC on request.
• All applications for loans for purchase, permanent financing for construction, or refinancing or residential real property to be used for the consumer’s principal dwelling are included.
• Excluded loans include home improvements, vacation homes, interim construction, mobile homes without real property, loans secured by real estate but for another purpose and vacant lots.


Application information required includes:
1. Loan Amount requested by the applicant(s).
2. Interest rate requested by the applicant(s).
3. Number of months requested to maturity by the applicant(s).
4. Location.
5. Number of residential units of the dwelling which will secure the loan.
6. Year built.
7. Purpose of the loan.
8. Name and present address of applicant(s).
9. Age of applicant(s).
10. Marital status of applicant(s) using the categories married, unmarried and separated.
11. Number of years employed in present line of work or profession for the applicant(s).
12. Years on present job.
13. Gross total monthly income of each applicant.
14. Proposed monthly housing payment.
15. Purchase Price
16. Applicant’s or applicants’ total monthly payments on all outstanding liabilities.
17. Net worth.
18. Date of application.
19. Sex of applicant(s).
20. Race/national origin of applicant(s) using the categories: American Indian or Alaskan Native; Asian or Pacific Islander; Black, not of Hispanic origin; White, not of Hispanic origin; Hispanic; Other

Andy,

Unless they are under order to do so from the OCC, they just have to attempt to obtain the data under 27.3(b) from the applicant and there is no logging requirements other than the monthly tracking of the information under 27.3(a).

It is really not that onerous to keep the Appendix I information.

Thanks for the info--my reading of the regulation, I agree that we only need to track the number of loans not the specifics on each as we would have that information in each file. If the OCC were to require us too, then we would have too. If we had to we might as well continue completing hmda lar!

The one thing is that in order to track to see if HMDA would come into play if we reach/exceed 100 originated is that under the Fair Housing home loan data system, we will track purchase, refi, and construction-perm. Under HMDA home improvement come into the count. So these regulations are not fully in line with each other. I guess we'd almost have to track loans that HMDA would apply to--to ensure we are under 100 each year to exempt us from HMDA. Am I thinking this through correctly?

I don't want to hijack the thread so if I should start a separate one please let me know!

My question is, the last two years we have averaged 40 HMDA reportable mortgages. Our only offering for first mortgages is a 5yr balloon (we do not advertise mortgages so the ones we do are for our existing commercial customers who ask as most others want conventional 30yrs). We are an FDIC bank. Other than keeping track of our total annual loan numbers, am I missing something? The above conversation has me feeling like I am … Lending compliance in general is newer for me so I'm feeling like I'm completely missing something else I should be doing - it cant' be that easy right?

SmallBank3 - I think it is that easy (assuming you don't need to track your loans for other reasons pointed out in this thread). You are well below the threshold, so counting your loans sounds simple enough. The only other major challenge you will have is transitioning to data collection under Regulation B. Basically, you will now need to collect GMI under Reg B instead of DI under HMDA. There are some similarities between the two, but there are also some major differences so training your team will be essential for this.