HOME MORTGAGE DISCLOSURE ACT (HMDA) REQUIREMENTS AND RECOMMENDED PRACTICES By FRANK P. ANTIGA, CPA, CBAP Risk Advisory Principal, S.R. Snodgrass PC The Home Mortgage Disclosure Act (HMDA), implemented by Regulation C, was enacted by Congress in 1975. Its primary goals are to promote transparency, determine whether financial institutions (“institution”) are meeting the housing credit needs of their communities and assist in identifying potential discriminatory lending patterns. Regulation C sets out specific requirements for the collection, recording, reporting and disclosure of mortgage lending information. The reporting requirements are incredibly detailed, and examinations allow very few errors before an institution may be required to correct and resubmit past data. HMDA violations can also lead to civil money penalties and/or consent orders from examining agencies. Coverage and Data Reporting Requirements Coverage is based on the prior year’s origination volumes, asset size and location of the institution’s home and retail offices. If the rule is applicable to the institution, it must collect, report and disclose detailed data about home lending activity via a Loan Application Registration (LAR). The institution must submit its HMDA data to its appropriate federal agency by March 1 following the calendar year for which it collected the data and requires electronic submission of the data. The regulation generally applies to consumer-purpose, closed-end loans and open-ended lines of credit that are secured by a dwelling. There are exclusions from coverage if the dwelling type is exempted. There are extremely specific rules on whether business/agricultural transactions are reportable, and there are also certain other transaction types that are specifically excluded under the regulation. At application, HMDA requires lenders to collect certain data related to general loan information, property information, applicant information and institutional 16 NEBRASKA INDEPENDENT BANKER
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