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#545798 - 05/10/06 03:27 PM Assumptions & HMDA
#12 Offline
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We have a few loans where an assumption is taking place. Most of them were originally 2 borrower loans (husband & wife), with one of them assuming the whole loan (I believe it's a divorce situation). A new deed is being done, etc, etc. Are these HMDA reportable? I know on page D-2 of the GIR it states that there must be awritten agreement in accepting a new borrower as the obligor on an existing obligation. What is confusing me, is that the person taking over the loan is a current borrower. Thanks for help, if I need to clarify further, let me know, and I will try!
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#545799 - 05/10/06 03:51 PM Re: Assumptions & HMDA
Truffle Royale Offline

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Quote:

A new deed is being done, etc, etc.




If "etc, etc," means you're doing a new note and mortgage then these are not really assumptions, they're buyouts and are HMDA reportable.

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#545800 - 05/10/06 04:02 PM Re: Assumptions & HMDA
#12 Offline
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Posts: 1,338
No, no new note & mortgage (not from my discussions with the lenders anyway). I believe they are just doing new disclosures showing the amount of the fee they are charging.
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#545801 - 05/10/06 04:10 PM Re: Assumptions & HMDA
Truffle Royale Offline

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Then apparently these assumptions are modifications of the existing loan so no, they would not be HMDA reportable.

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#545802 - 05/10/06 04:13 PM Re: Assumptions & HMDA
#12 Offline
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Joined: Jun 2005
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Thank you, that is what I was leaning towards as well.
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#545803 - 05/10/06 07:00 PM Re: Assumptions & HMDA
#12 Offline
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Joined: Jun 2005
Posts: 1,338
Just wanted to update. I had submitted the question to HMDA help just prior to posting the question here (I posted here because we all know how unhelpful HMDA help is). The following is what they sent me.
|
| To: hmdahelp@frb.gov
| Subject: Assumptions & HMDA
We have several loans which are currently in the names of husband and
wife (or 2 people). One of the current borrowers is going to assume
the
entire loan. There will be a new deed prepared with ownership being
transferred from the couple to the individual. Would this be HMDA
reportable as a purchase or refinance? Is it even reportable?


>>> hmdahelp@frb.gov 5/10/2006 11:54:45 AM >>>
Did you already report these loans as home purchase loans? They would
qualify as a refinance only if they meet the HMDA reportable
definition: A
refinancing is (1) any dwelling-secured loan that (2) replaces and
satisfies (3) another dwelling-secured loan (4) to the same borrower.
2004
HMDA Guide, page 8. http://www.ffiec.gov/hmda/guide.htm




>---------------------------------------------------------------------------------------------------------------------- |
| To: hmdahelp@frb.gov |
| Subject: Re: Assumptions & HMDA (D) |

I know the definition of a refinance. My question more relates to page
D-2 of the getting it right guide. It states that "An assumption occurs
when an institution enters into a written agreement accepting a new
borrower as the obligor on an existing obligation. An institution
reports as a home purchase loan an assumption in the amount of the
outstanding principal." Does changing the borrower from husband and
wife to husband only constitute a "new borrower?"

>>> hmdahelp@frb.gov 5/10/2006 11:54:45 AM >>>

yes
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#545804 - 05/10/06 07:48 PM Re: Assumptions & HMDA
Dan Persfull Offline
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Dan Persfull
Joined: Aug 2002
Posts: 46,832
Bloomington, IN
IMO, the loan is only reportable if you have a new note signed, the transfer of title does not play into it. If you are doing this simply by a modification the loan is not reportable. However, if you are having a new note signed by the person assuming the loan that replaces the existing obligation then you would have a reportable refinancing.

How can the "assuming" spouse assume an obligation that they are already obligated to repay?
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The opinions expressed are mine and they are not to be taken as legal advice.

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#545805 - 05/10/06 08:02 PM Re: Assumptions & HMDA
#12 Offline
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Joined: Jun 2005
Posts: 1,338
Good point, thanks Dan. I will check into this a little bit more and see exactly what documents are going to be signed.
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#545806 - 05/12/06 06:29 PM Re: Assumptions & HMDA
Happy2006 Offline
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Joined: May 2006
Posts: 1
I was able to assume my Mtg. loan when I got a divorce. I am not sure if it matters, but I live in a commuity property state.

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#545807 - 05/15/06 12:10 PM Re: Assumptions & HMDA
Sage Offline
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Joined: Aug 2005
Posts: 914
If new parties to the loan sign an assumption agreement, rather than a new note, for a home purchase loan, I think you have to report HMDA, right?

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#545808 - 07/11/06 02:59 PM Re: Assumptions & HMDA
JSD Offline
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JSD
Joined: Oct 2000
Posts: 512
USA
Also, the question that comes to mind in these assumption loans regarding the flood determination - since it is a new loan (new note)and a different borrower (father assuming loan from daughter), could you use the previous flood determination if no changes to the map and same property or not?
Sorry - Found the answer - Same property + same lender = same determination as long as the three requirements are met.
Last edited by JSD; 07/11/06 03:06 PM.
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#545809 - 07/11/06 03:06 PM Re: Assumptions & HMDA
Dan Persfull Offline
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Dan Persfull
Joined: Aug 2002
Posts: 46,832
Bloomington, IN
Same property + same lender = same SFHDF if it meets the criteria.

However, if you are changing borrowers and use LOL monitoring you need to check with your vendor to find out how they track the property. Do they track by loan #, or by property? This may dictate whether you need to get a new determination.
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#545810 - 07/11/06 03:08 PM Re: Assumptions & HMDA
JSD Offline
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JSD
Joined: Oct 2000
Posts: 512
USA
Thanks Dan, in this instance the flood vendor assigns an id # to the flood cert, so it should be ok.

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