1. HMDA/FHHLDS # 5262
Corporate Compliance
2016 Training

2. HMDA FHHLDS Overview

3. Transactions to be Reported
The HMDA requirements generally apply to loan transactions (whether the credit request is ultimately originated or denied) for the purchase, refinance or improvement of a dwelling. More precisely:
Applications for home purchase loans are covered if the loan is secured by the dwelling being purchased or by another dwelling. The dwelling need not be a primary residence; therefore, a loan application for the purchase of a vacation home is covered by HMDA. A commercial loan application made for the purpose of purchasing an apartment complex would also be covered by HMDA. Note: Institutions that have a qualified pre-approval program must also report whether the application or loan involved a request for a pre-approval of a home-purchase loan. TCF pre-qualifies applicants but does not have a pre-approval program under HMDA.

4. Transactions to be Reported, continued
Applications for refinancing of a loan (or land contract or contract for deed) that is secured by a 1-4 family dwelling are also covered. Note: If a loan will be used both for home improvements and refinancing, it is reported as a home improvement loan. The definition of refinancing is: a transaction in which a new obligation satisfies and replaces an existing obligation b the same borrower, where both the existing and the new loan are secured by a lien on a dwelling.
Applications for home improvement loans, whether secured or unsecured, are covered. The definition of home improvement covers all loans secured by a dwelling and loans that are non-dwelling secured or unsecured that are made in whole or in part to improve the dwelling or the real property on which the dwelling is located.

5. Transactions to be Reported, continued
The following transactions may / must be reported (as applicable):
If the bank purchases HMDA reportable loans from another institution those loans must be reported.
Although short-term construction loans and other temporary financings are not covered, construction loans with permanent end financing are covered.
Banks have the option to include or exclude home equity lines of credit. Note: TCF has elected to exclude home equity lines of credit.

6. Transactions Not to be Reported
Short-term construction loans and other temporary financings.
Loans on unimproved land.
Purchases of an interest in a pool of loans.
Purchases of loan servicing rights.
Loans made or purchased in a fiduciary capacity.

7. Types of Dwellings Excluded
Certain types of dwellings are also excluded from HMDA reporting requirements. Recreational vehicles, such as boats and campers, are not dwellings for HMDA purposes. Also excluded are transitory residences such as hotels, hospitals, and college dormitories. Further, because the purchase of a time-share is considered the purchase of a “use” interest in the property, it is not a purchase of a dwelling for HMDA purposes.
The OCC’s FHHLDS requirements apply to a similar, but not quite identical, set of loan applications. The main differences are that:
Only loans for primary residences are covered.
The residence must be occupied by the applicant.
They only apply to real estate loans for the purchase, permanent financing for construction, or the refinancing of real property.

8. Information Collected
The types of information required by both the HMDA and FHHLDS are summarized in the chart below and continued on the next several slides. For more information about TCF procedures on HMDA data collection and reporting, see Loan Originations Manual subject 603.
Type of Information
Required by
HMDA
FHHLDS
Application/Loan Number X
Date Application Received
Loan Type (Conventional, FHA, VA, FSA/RHS)
Loan Type (Standard Fixed Payment, Variable Rate, Graduated Payment, Rollover, or Other
Property Type (1-4 Family, Manufactured Housing, Multi-family)
Purpose (Home Purchase, Home Improvement, Refinance, Multi-family)
Purpose (Purchase, Refinance, Construction-permanent)
Occupancy
Loan Amount

9. Type of Information Required by HMDA FHHLDS Request for Preapproval X
Action Taken
Date Action Taken
Property Location – State, County, Metropolitan Area
Property Location – Census Tract
Property Location – Complete Address and County
Applicant(s) Ethnicity
Applicant(s) Race
Applicant(s) Sex
Applicant(s) Gross Annual Income
Applicant(s) Monthly Gross Income
Applicant(s) Name and Present Address
Applicant(s) Age
Applicant(s) Marital Status
Applicant(s) Years of Employment in Current Line of Work
Applicant(s) Years on Present Job
Applicant(s) Monthly Debt Payments
Applicant(s) Net Worth
Type of Purchaser

10. Type of Information Required by HMDA FHHLDS Reason(s) for Denial X
Rate Spread
HOEPA Status
Lien Status
Interest Rate Requested
Number of Months to Maturity Requested
Proposed Monthly Housing Payment
Purchase Price (or approximate current market value)
Number of Units
Year Built
Appraised Value if an appraisal is done
Commitment Date
Loan Terms Offered and Accepted
Whether PMI is Required and Terms of Insurance
Whether a Deposit Balance is Required and the Amount
Note Rate
Points Charged to Buyer XX
Bank Office where Application was Submitted

11. Collection of Government Monitoring Information (GMI)
Information about ethnicity, race, sex, marital status, or other “prohibited bases” of discrimination that must be collected under HMDA or FHHLDS requirements may not be used in making a credit decision. Applicants must be given the option to indicate whether they are or are not Hispanic/Latino and have the option of selecting one or more racial designations.

12. Collection of Government Monitoring Information (GMI), continued
In requesting information about ethnicity, race and sex, both HMDA and FHHLDS require lenders to inform applicants about why the information is requested and that the applicants do not have to provide the information. However, the lender is required to complete the information based on visual observation or surname if the application is taken in person (face-to-face). The lender must ask the applicant for this information (but cannot require that the applicant provide it) whether the application is taken in person, by mail or telephone, or on the Internet.

13. Collection of Government Monitoring Information (GMI), continued
For applications taken by telephone, the lender must orally provide the following statement:
The following information is requested by the Federal Government for certain types of loans related to a dwelling in order to monitor the lender’s compliance with equal credit opportunity, fair housing, and home mortgage disclosure laws. You are not required to furnish this information, but are encouraged to do so. You may select one or more designations for “Race.” The law provides that a lender may not discriminate on the basis of this information, or on whether you choose to furnish it.
The GMI information, along with the information identified in the previous lis, is recorded on the bank’s Loan Application Register (LAR).
FHHLDS information must be kept in loan/application files, available for review by examiners.

14. Publicly Available Information
The data collected on all HMDA reportable transactions must be recorded on the bank’s LAR within thirty calendar days after the end of the calendar quarter in which final action is taken. Every year, by March 1, the previous calendar year’s LAR must be submitted to the bank’s federal regulatory agency. The Federal Financial Institutions Examination Council (FFIEC) compiles the data submitted annually by all financial institutions and sends each institution a “Disclosure Statement,” which summarizes the information in the LAR. Both the Disclosure Statement and a modified version of the LAR (which omits any personal information that could identify an applicant), must be made available to the public. TCF’s Public File is maintained by Corporate Compliance (1405 Xenium Lane N, Plymouth, MN 55441, Mail Code PCC-1H-C). A notice in the lobby of each branch or lending office announces the availability of this information. FHHLDS information does not have to be made publicly available.

15. Home Mortgage Disclosure Act Notice
The HMDA data about TCF National Bank’s residential mortgage lending are available for review. The data show geographic distribution of loans and applications; ethnicity, race, sex, and income of applicants and borrowers; and information about loan approvals and denials. To receive a copy of these data, send a written request to: TCF National Bank Compliance Officer 1405 Xenium Lane N Mail Code PCC-1H-C Plymouth, MN 55441

16. Record Keeping
Disclosure statements must be available to the public for 5 years and the modified LARs for 3 years. FHHLDS information must be kept at least 25 months after the applicant is notified of the action taken, or the application is withdrawn.

17. Consequences of Non-Compliance
The regulatory agencies can use their general enforcement powers to ensure compliance with HMDA’s requirements. Each error could be subject to a fine. The OCC can impose even more stringent logging and record keeping requirements if banks do not meet the basic FHHLDS requirements. They can also use their general enforcement powers to ensure compliance.

18. HMDA FHHLDS 5262 Quiz

19. Course Complete!
Thank you for completing this course. As a reminder, you may print a certificate of completion to give to your supervisor.