The Home Mortgage Disclosure Act (HMDA) is a federal law that requires mortgage lenders to collect and report data about their lending practices. This data is used to monitor fair lending and to identify possible discriminatory lending patterns.
Key Facts
- Demographic Information: Lenders must collect and report the ethnicity, race, and gender of mortgage applicants and borrowers.
- Gross Income: Lenders are required to collect and report the gross income of mortgage applicants and borrowers.
- Loan Information: Lenders must report information about the loan, including the application date, loan amount, loan type (e.g., home purchase, home improvement, refinancing), and details on collateral.
- Pricing Information: Lenders are required to report information regarding the pricing of the loan, such as the interest rate, points, and fees.
- Home Ownership and Equity Protection Act (HOEPA): Lenders must indicate whether the loan is subject to the Home Ownership and Equity Protection Act, which provides additional protections for certain high-cost mortgage loans.
Demographic Information
Lenders must collect and report the ethnicity, race, and gender of mortgage applicants and borrowers. This information is used to assess whether lenders are serving the housing needs of all segments of the community.
Gross Income
Lenders are required to collect and report the gross income of mortgage applicants and borrowers. This information is used to assess the creditworthiness of the borrower and to determine the appropriate loan terms.
Loan Information
Lenders must report information about the loan, including the application date, loan amount, loan type (e.g., home purchase, home improvement, refinancing), and details on collateral. This information is used to track lending activity and to identify trends in the mortgage market.
Pricing Information
Lenders are required to report information regarding the pricing of the loan, such as the interest rate, points, and fees. This information is used to assess the cost of mortgage credit and to ensure that borrowers are not being overcharged.
Home Ownership and Equity Protection Act (HOEPA)
Lenders must indicate whether the loan is subject to the Home Ownership and Equity Protection Act (HOEPA), which provides additional protections for certain high-cost mortgage loans. This information is used to ensure that borrowers are aware of their rights under HOEPA.
Conclusion
The HMDA is an important law that helps to ensure fair lending and to protect consumers. The data collected under HMDA is used to monitor lending activity, to identify trends in the mortgage market, and to assess the cost of mortgage credit. This information is used by policymakers, regulators, and consumers to make informed decisions about mortgage lending.
Sources
- https://www.federalreserve.gov/boarddocs/caletters/2009/0910/09-10_attachment.pdf
- https://www.consumerfinance.gov/compliance/compliance-resources/mortgage-resources/hmda-reporting-requirements/
- https://www.wolterskluwer.com/en/expert-insights/understanding-hmda-reporting-a-comprehensive-guide-for-lenders
FAQs
What information is needed for HMDA?
Lenders must collect and report the following information for HMD
- Demographic information: ethnicity, race, and gender of mortgage applicants and borrowers
- Gross income of mortgage applicants and borrowers
- Loan information: application date, loan amount, loan type, and details on collateral
- Pricing information: interest rate, points, and fees
- Home Ownership and Equity Protection Act (HOEPA) status
What is the purpose of HMDA?
HMDA is a federal law that requires mortgage lenders to collect and report data about their lending practices. This data is used to monitor fair lending and to identify possible discriminatory lending patterns.
Who must comply with HMDA?
All mortgage lenders, including banks, credit unions, savings associations, and mortgage lending companies, must comply with HMD
What types of loans are covered by HMDA?
HMDA covers home purchase loans, home improvement loans, and refinancings.
What is the deadline for submitting HMDA data?
HMDA data must be submitted to the lender’s supervisory agency by March 1st of the year following the calendar year in which the data was collected.
How can I obtain HMDA data?
HMDA data is available to the public from the Federal Financial Institutions Examination Council (FFIEC).
What are the penalties for non-compliance with HMDA?
Penalties for non-compliance with HMDA can include civil money penalties, cease-and-desist orders, and removal from the list of approved lenders.
How can I learn more about HMDA?
You can learn more about HMDA by visiting the FFIEC’s website or by contacting your lender.