Renewal path changed to Refinance

Posted By: Likes to Comply

Renewal path changed to Refinance - 11/22/17 01:49 PM

If a customer applies to renew their loan (true renewal - note would not replace and extinguish previous note) but for some reason during the loan process it is determined that instead this loan must be refinanced (a covered loan for HMDA) must we at that point try to obtain the Demographic Information from the applicant?
Posted By: Dan Persfull

Re: Renewal path changed to Refinance - 11/22/17 03:38 PM

Once it becomes a covered loan you must comply with the applicable regulations.
Posted By: David Dickinson

Re: Renewal path changed to Refinance - 11/22/17 05:43 PM

I agree. In a sense, you have a new application - a new request. Not that you need to complete a new application form, but rather the request has changed. At the point this happens, it became subject to HMDA. Document the date and what happened (tell the story).
Posted By: Likes to Comply

Re: Renewal path changed to Refinance - 11/22/17 08:37 PM

Thanks!!!
Posted By: Banker K, CRCM

Re: Renewal path changed to Refinance - 11/27/17 05:29 PM

When we are faced with these situations (oh yeah, here too...) our procedure is to have the very first application form in file and stamp "initial" at top right, then print a revised application (noting what changed - ex: purpose) with the date of that revision and then any applicable disclosure docs (ex: the GMI) would be dated with that date as well.

Our overall loan application date would be the earlier date.
However, based on my understanding, for Reg C HMDA reporting, the app date on the LAR would be the date it actually turned into a HMDA application.
Any thoughts on that???
Posted By: David Dickinson

Re: Renewal path changed to Refinance - 11/27/17 07:58 PM

. . .the app date on the LAR would be the date it actually turned into a HMDA application."
Agree. It's not a HMDA application until it becomes subject to HMDA. For example, I might get prequalified last month, but don't have a house picked out. You have a Reg B app, but not a HMDA app at this time. Assume I find a house today and call with the address. Today you have a HMDA application. Document this and record it on the LAR with an application of today (not last month).