We have been a HMDA reporter since 2004 due to being in an MSA. We originate a very small amount of home purchase loans. We originated 25 in 2016 and only 15 in 2017 and are thinking we will stay under 25 for 2017 for Home Purchase Loans. We are hoping that we might be exempt from HMDA Reporting in 2018. My question is the counting of "refinance of home purchase loans". How do we track the refinance of home purchase loans? Is this only for loans that we refinanced that were already on our books? We don't document this in the file and the only way to go back would be to look at the original loans. Also, how would we know if the refinance from another institution was originally a home purchase loan, other than a statement from the borrower and how would we track this?

"Refinance" is for ANY loans where your loan is paying off an existing loan - whether the original loan was at your bank or another AND whether the original loan was to purchase or for any other reason. IOW, the definition of "refinance" is pretty encompassing. All you need to a new, dwelling secured loan that satisfies and replaces and existing dwelling secured loan by the same borrower [1003.2(p)].


You can't just look at loans on your books that are refinanced. You can't look at purchases that are refinanced.

To try to make it even more clear, HMDA is NOT referring to only the first refinance of a home purchase loan as reportable.
I think that's what you're trying to narrow it down to isn't it, JMCBT?
There is no need to go ferreting about to try to find out if you're refinancing the loan the borrower used to buy the dwelling.
For HMDA purposes, EVERY time you satisfy and replace an existing dwelling secured loan to the same borrower, you have a refinance.
Doesn't matter if this is the first time after the original purchase or the third time the borrower is refinancing their home.
It's HMDA reportable as a refinance.

So we would look at the LARs for the previous two years and count both Home Purchase and Refinances (no matter what the original purpose was)?

Yes, but you can't only look at the LAR beginning in 2018. The coverage and exemptions are changing. Thus, you will have some loans on your LAR that are no longer subject to HMDA (agricultural purpose, for instance) and you will have some loans that aren't on your LAR that need to be counted (construction/bridge only, for instance). You can start with your LAR and, after applying the new coverage and exemptions to it, if you're over 25 loans or 100 lines, you know you're still subject to HMDA. But if you are below 25/100, you may still be subject to HMDA because some loans that weren't reported in 2016 and 2017 need to be.

IOW, for those "on the fence", this is a tough issue to determine.

Thank you for the response. This helps!