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#2188191 - 08/06/18 08:59 PM Two denials, same property, report twice?
Debbie Offline
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I have a denial for one borrower. The borrower then added his wife, we are denying it also. So do I do HMDA on both denials?

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#2188193 - 08/06/18 09:27 PM Re: Two denials, same property, report twice? Debbie
raitchjay Offline
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You say he added his wife, which sounds to me like you treated it as a continuation of the first application. If that's the case, just report once. If you treated them as 2 different applications, you'd report twice.
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#2188218 - 08/07/18 01:42 PM Re: Two denials, same property, report twice? Debbie
Debbie Offline
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We have two applications and two adverse action notices. But in the past our third party auditors always told us you only put a property on the LAR once, never twice. I'm new to HMDA so I don't know if that was the rule before 2018, or if that is still the rule. But the mortgage department is having a hard time with putting it on the LAR twice based on what auditors have told us in the past.

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#2188222 - 08/07/18 01:47 PM Re: Two denials, same property, report twice? Debbie
raitchjay Offline
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That's never been the rule.....in theory, someone could apply and get denied to buy the same property 15 times in a year. If that were the case, that property would get reported 15 times on your LAR.
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#2188223 - 08/07/18 01:51 PM Re: Two denials, same property, report twice? Debbie
raitchjay Offline
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(A more likely scenario that also shoots down your auditors' claim: customer refinances their home with you in January. Goes on the LAR. Customer comes back in November needing to refinance, this time with cash out. Gets reported on your LAR. Same property.)
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#2188315 - 08/07/18 08:00 PM Re: Two denials, same property, report twice? Debbie
John Burnett Offline
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Auditor hasn't ever seen the same property on the LAR more than once. Auditor assumes that's because it can't happen. Auditor makes sweeping (erroneous) statement. Bankers scratch their heads. Until one banker challenges the auditor. Now the auditor is scratching his head. Can't find anything to support the sweeping statement or to challenge it. Until the auditor reads this thread and sees the light.
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#2188364 - 08/08/18 12:46 PM Re: Two denials, same property, report twice? Debbie
RR Joker Offline
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Originally Posted By Debbie
We have two applications and two adverse action notices. But in the past our third party auditors always told us you only put a property on the LAR once, never twice. I'm new to HMDA so I don't know if that was the rule before 2018, or if that is still the rule. But the mortgage department is having a hard time with putting it on the LAR twice based on what auditors have told us in the past.


Debbie, let me tell you from years of HMDA Heck a few ways your scenario can play out.

Husband applies for loan - denied - reported.

Husband comes back with wife and reapplies - denied - reported separately [now you have 2], OR
a) reinstate the original application adding additional borrower - delete the first reported, report the combined app. [often happens on denials with counter-offers for addition of a supporting borrower]

If you cross years, do not do a) above. You can't reinstate an application that crosses reporting years wink
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#2188516 - 08/09/18 02:37 PM Re: Two denials, same property, report twice? RR Joker
Debbie Offline
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RR Joker your example is similar to the situation we have, but we did not issue a counteroffer, just a denial for insufficient funds for downpayment. So applicant applies jointly with wife, although that did not cure the reason for denial, they don't have any more money jointly than he did individually. The request is the same in terms of amount and property. Can we treat this as a continuation of application? The mortgage department only wants to report it once and defended with "auditor said no property twice", which I understand is not supported by the reg. But can we support reporting it once based on reinstatement/continuation? Thank you

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#2188525 - 08/09/18 03:04 PM Re: Two denials, same property, report twice? Debbie
raitchjay Offline
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Yes, you can treat it as a continuation of the first application. (But your mortgage department and the auditor are still wrong.)
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#2188527 - 08/09/18 03:16 PM Re: Two denials, same property, report twice? Debbie
RR Joker Offline
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RJ answered correctly...both parts smile
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#2256845 - 07/19/21 12:47 PM Re: Two denials, same property, report twice? Debbie
complyorelse Offline
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We have a reinstatement scenario and I'm hoping for guidance on properly reporting this; the original decision and second decision were in same calendar year so that isn't an issue. My question is about the loan terms. Originally applied for a HELOC and we denied it. They came back and wanted a fixed loan. We approved that, but they withdrew the request before all underwriting conditions were met. Since we reinstated the application after it was denied, do we report the terms and withdrawal of the reinstated application request?

Thank you.

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#2256847 - 07/19/21 01:15 PM Re: Two denials, same property, report twice? Debbie
rlcarey Offline
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I am not sure how you can reinstate a denied HELOC application and turn it into a closed-end loan application.
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#2256852 - 07/19/21 02:01 PM Re: Two denials, same property, report twice? Debbie
complyorelse Offline
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The original application was for a HELOC, we countered with a fixed and they did not accept it. The counteroffer was verbal. Once the AAN was received, they came back and wanted to consider the fixed but then withdrew. Does this not fit a reinstated application? Is it better as a separate entry?

From Official Interpretation Paragraph 4(a)(1)(ii)
3. Application date—reinstated application. If, within the same calendar year, an applicant asks
a financial institution to reinstate a counteroffer that the applicant previously did not accept (or
asks the institution to reconsider an application that was denied, withdrawn, or closed for
incompleteness), the institution may treat that request as the continuation of the earlier
transaction using the same ULI or NULI or as a new transaction with a new ULI or NULI. If the
institution treats the request for reinstatement or reconsideration as a new transaction, it reports
the date of the request as the application date. If the institution does not treat the request for
reinstatement or reconsideration as a new transaction, it reports the original application date.

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#2256854 - 07/19/21 02:36 PM Re: Two denials, same property, report twice? Debbie
Dan Persfull Offline
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Bloomington, IN
FWIW we treat these as new transactions and report both requests. By doing it this way we don't have to worry about going back on the LAR and making any necessary changes to the action taken and action taken date, loan amount, terms, etc.
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#2256859 - 07/19/21 02:54 PM Re: Two denials, same property, report twice? Debbie
complyorelse Offline
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Good to know; I prefer that as well for the very reason that I am having to ask about how to properly report...muddy waters. Typically they do start over with a new entry so I'm not sure why this was handled differently.

If we were to report this as one (reinstated) application, are we to report all of the data for the reinstated application except the application date which would be the original application date?

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#2256862 - 07/19/21 02:57 PM Re: Two denials, same property, report twice? Debbie
Dan Persfull Offline
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Bloomington, IN
You would report the applicable information for the final disposition of the the reinstated loan request.
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#2256873 - 07/19/21 03:58 PM Re: Two denials, same property, report twice? Debbie
complyorelse Offline
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Thanks, Dan. I appreciate your input.

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