More than likely a stooopid question....but....

Would a guarantor be considered and reported as a co-applicant?

If a Covered Loan or Application includes a guarantor, a Financial Institution does not report the guarantor’s ethnicity, race, sex, age or income.

I found this thread

It started back in 2004 but recently in 2017.

I thought, for HMDA, you would report the income relied upon for the decision. The guarantor's income WAS relied upon. Otherwise, the loan could not have been made. Seems it would skew the data for someone whose income is $30,000 was granted a loan when the income relied upon is $120,000. While over in the declined applications, a person with $30,000 was denied the same loan.

Also, with respect to income, the CFPB's Regulatory and Reporting Overview Reference Chart states under "income" to report the gross annual income relied on in making the decision. For my loan scenario, we relied on the guarantor's income for the decision.

Well, you have to decide if they are a co-applicant or a guarantor. Typically, a guarantor is analyzed separately and their income is not combined with that of the applicant. The guarantor will totally take over the loan in the event that the applicant fails to honor their obligation.


Paragraph 4(a)(10)(iii)

1. Income data—income relied on. When a financial institution evaluates income as part of a credit decision, it reports the gross annual income relied on in making the credit decision. For example, if an institution relies on an applicant's salary to compute a debt-to-income ratio but also relies on the applicant's annual bonus to evaluate creditworthiness, the institution reports the salary and the bonus to the extent relied upon. If an institution relies on only a portion of an applicant's income in its determination, it does not report that portion of income not relied on. For example, if an institution, pursuant to lender and investor guidelines, does not rely on an applicant's commission income because it has been earned for less than 12 months, the institution does not include the applicant's commission income in the income reported. Likewise, if an institution relies on the verified gross income of the applicant in making the credit decision, then the institution reports the verified gross income. Similarly, if an institution relies on the income of a cosigner to evaluate creditworthiness, the institution includes the cosigner's income to the extent relied upon. An institution, however, does not include the income of a guarantor who is only secondarily liable.

Guarantors are not applicants for HMDA. You do not report anything about them for HMDA even if it was considered by the loan officer / underwriter. No ethnicity, race, sex; No Income; Nothing.

Thank you everyone for your feedback!!