I am doing a purchase money HELOC. Can I collect government monitoring info, since home equities are not HMDA reportable?
Do we collect monitoring information when the collateral of our loan is a consumer’s principal dwelling, but the purpose of the loan is for something like educational expenses? We are trying to hash out which application would be most appropriate. I am thinking that we would use a Consumer Loan application without the monitoring information or a Uniform Residential Loan Application without monitoring information.
In reading a response by Dan Persfull dated 7/7/08 titled "GMI on Refinance" he states that the definition of a refinancing applies whether you are refinancing one of your loans or a loan from another financial institution. However, if I read the definition of refinancing under Reg B - Supplement I (Official Staff Interpretations)it states the following: Sec. 202.13 Information for Monitoring Purposes 6. Refinancings. A refinancing occurs when an existing obligation is satisfied and replaced by a new obligation undertaken by the same borrower. A creditor that receives an application to refinance an existing extension of credit made by that creditor for the purchase of the applicant's dwelling may request the monitoring information again but is not required to do so if it was obtained in the earlier transaction. So do we collect it if we are refinancing the original purchase money from another financial institution or only if we financed the original purchase money?
If part of the proceeds on a home equity loan are being used for home improvement, are we required to collect government monitoring information if we are not subject to HMDA reporting?
I am brand new to compliance at a small national bank that does not do HMDA reporting. Do we still have to collect the information (gray areas of the residential loan application) as required by 12 CFR 27?
Should we be collecting applicant information (race, ethnicity, sex) on non-reportable real estate loans? Some examples would be loans against a borrower's home for the purpose of financing college tuition, taking a vacation, purchasing stock, etc. I know we would not include this on our LARs or on the information we send to HUD. I am simply wondering about gathering it for the file. The reason I am wondering if should we have it collected is in case we ever go through a fair lending audit.
Should GMI be collected on a primary residence refinance when additional money is added to the mortgage amount?
One of our branches made a multiple advance consumer purpose loan to purchase and renovate an existing home that the borrowers will move into after renovation. At the time the loan was made, the branch had (and still has) a commitment letter for permanent financing from another lender. Per HMDA guidance "The regulation lists as examples of temporary financing construction loans and bridge loans. See 203.4(d)(3). Construction and bridge loans are illustrative, not exclusive, examples of temporary financing. The examples indicate that financing is temporary if it is designed to be replaced by permanent financing of a much longer term. A loan is not temporary financing merely because its term is short. For example, a lender may make a loan with a one year term to enable an investor to purchase a home, renovate it and resell it before the term expires. Such a loan must be reported as a home purchase loan. See 203.2(h)." Therefore, because of that outside commitment letter, we determined that it was not HMDA reportable. However, since it is a loan to purchase an existing dwelling that will be occupied by the applicant as a primary dwelling, is monitoring information required under Reg B? I have been told that for monitoring purposes, we have two tests to fulfill, the HMDA test and the Reg B test. We already know this is temporary under HMDA and not HMDA reportable, but I'm not sure if I need monitoring information under Reg B. Specifically, 12 CFR 202.13 states that a bank must get monitoring information for dwelling purchase loans or refinancing of a purchase money loans. It appears, based on what I have been told before, that only the initial construction of a home is exempt under Reg B for monitoring purposes. From past training, I seem to recall that other temporary loans, such as bridge loans and the loan in question, are still covered by the monitoring information requirements of Reg B since they are to purchase an existing dwelling. Is that correct or can I use the same temporary financing test for HMDA and Reg B?
During a face-to-face loan application interview, does the borrower have to complete the government monitoring information in their own handwriting? In most cases, applications are being originated on loan origination software. Is it acceptable for the originator/lender to orally state the GMI statement to the borrower and input the borrower's response so it displays on the application document in typewritten form?
This is in regards to reporting Government Monitoring Information. We are a wholesale lender and when we receive a file from a broker we enter the application information into our originating system. On a telephone or mailed application, there will be times when the broker checks the box "I do not wish to furnish this information" and the box "male." We enter that same information into our system. However, when we pull our LAR, "info not provided" is what appears (not that male was checked). This only happens on telephone and mailed applications. On face to face applications, all the boxes that are checked transfer over to the LAR. The originating and HMDA reporting software is widely used in the industry. When I asked them about this issue, I was told it's because when a borrower checks the box "I do not wish to furnish this information" (on a telephone or mailed application), the other information is not required to be collected so it is not reported on the LAR. Our bank examiner does not agree with this and says we are required to report everything that is on the application (even on a telephone or mailed application). Who's right?