Posted By: CloudShape
HMDA exams - 01/25/22 02:05 PM
And maybe this should be under HMDA - if so, feel free to move it.
I followed a thread within the last year I think, about how the CFPB seems to have shifted its thinking on HMDA reportable loans from what it will be to what is it at the time of consummation. Most of the conversation revolved around abandoned dwellings and the CFPB still considers them to be dwellings, no matter what shape they are in, for HMDA reporting purposes.
So we have a loan that we would have considered HMDA, based on what it will be, but are now calling it not HMDA because of what it was at consummation. Borrower bought a motel. It was a vacation motel with all the rooms as suites (included kitchen facilities). The borrower's intent is not to operate it as a motel, but to rent out the suites as apartments on short or long term leases, as furnished studio apartments. No renovations are being planned for the property. There is also a SFR on the property, but as the motel is larger both in square footage and income, it is a motel that is being bought. Motels are not HMDA reportable so we are calling it not HMDA.
My question is, since this shift in thinking, has anyone been cited on an exam for basing the HMDA reporting on what it is at consummation, rather than what it will be? My concern is that there is nothing specific that states reportability is based on what it is at consummation in the regulation, commentary, or FAQs, although a lot can be inferred, so I really don't want this one to come back and bite us.
Thank you.
I followed a thread within the last year I think, about how the CFPB seems to have shifted its thinking on HMDA reportable loans from what it will be to what is it at the time of consummation. Most of the conversation revolved around abandoned dwellings and the CFPB still considers them to be dwellings, no matter what shape they are in, for HMDA reporting purposes.
So we have a loan that we would have considered HMDA, based on what it will be, but are now calling it not HMDA because of what it was at consummation. Borrower bought a motel. It was a vacation motel with all the rooms as suites (included kitchen facilities). The borrower's intent is not to operate it as a motel, but to rent out the suites as apartments on short or long term leases, as furnished studio apartments. No renovations are being planned for the property. There is also a SFR on the property, but as the motel is larger both in square footage and income, it is a motel that is being bought. Motels are not HMDA reportable so we are calling it not HMDA.
My question is, since this shift in thinking, has anyone been cited on an exam for basing the HMDA reporting on what it is at consummation, rather than what it will be? My concern is that there is nothing specific that states reportability is based on what it is at consummation in the regulation, commentary, or FAQs, although a lot can be inferred, so I really don't want this one to come back and bite us.
Thank you.