Personal Finance

What is the purpose of HMDA?

By: Roman PerepelitsaUpdated: December 27, 2020


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The Home Mortgage Disclosure Act (HMDA) is a federal act approved in 1975 that requires mortgage lenders to keep records of certain key pieces of information regarding their lending practices which they must submit to regulatory authorities. It was implemented by the Federal Reserve through Regulation C.

Keeping this in view, what information does HMDA require?

HMDA requires lenders to report the ethnicity, race, gender, and gross income of mortgage applicants and borrowers. Lenders must also report information regarding the pricing of the loan and whether the loan is subject to the Home Ownership and Equity Protection Act, 15 U.S.C. 1639.

Secondly, what is HMDA approval?

ANS :To put it simply, the Master Plan and a valid layout approval guides usage of land and regulates the development activities in an area. A valid layout approval means you can utilize the plot for development purpose like building construction, etc. after duly obtaining permission as per law.

What is a HMDA reportable loan?

Under HMDA and Regulation C, a transaction is reportable only if it is an Application for, an origination of, or a purchase of a Covered Loan. If the transaction involves a Covered Loan, it is reported only if the institution meets the applicable loan-volume thresholds.

Who is exempt from HMDA?

If you originated fewer than 500 closed-end mortgage loans, but more than 500 open-ended lines of credit, you are only exempted from reporting the data for those mortgage loans. You would still have to report all the new HMDA data for those 500+ open-ended lines of credit.


Which kind of loans are covered by HMDA?

A closed-end mortgage loan or an open-end line of credit that is or will be made primarily for business or commercial purposes, unless it is a home improvement loan, a home purchase loan, or a refinancing. 12 CFR 1003.3(c)(10).

Who enforces HMDA?

The Home Mortgage Disclosure Act (HMDA) was enacted by Congress in 1975 and was implemented by the Federal Reserve Board's Regulation C. On July 21, 2011, the rule-writing authority of Regulation C was transferred to the Consumer Financial Protection Bureau (CFPB).

What is not HMDA reportable?

Report if the purpose of the loan was to PRR a commercial dwelling, such as a multi-family apartment complex. If the purchase money loan was secured by a commercial office building (not a dwelling) or a CD, it is not reportable even though the purpose was to purchase an apartment building or a rental property. 5.

What does HMDA mean?

Home Mortgage Disclosure Act

What is the HMDA Disclosure Statement?

Home Mortgage Disclosure Act Notice
The data show geographic distribution of loans and applications; ethnicity, race, sex, age, and income of applicants and borrowers; and information about loan approvals and denials.

What is red lining?

In the United States, redlining is the systematic denial of various services by federal government agencies, local governments as well as the private sector, to residents of specific neighborhoods or communities, either directly or through the selective raising of prices.

What are covered loans?

Covered loan means a consumer loan in which the original principal balance of the loan does not exceed the most current conforming loan limit for a single-family first mortgage loan established by the Federal National Mortgage Association in the case of a mortgage or deed of trust.

What did Dodd Frank add to HMDA?

Among other changes, the Dodd-Frank Act expanded the scope of information relating to mortgage applications and loans that institutions must compile, maintain, and report under HMDA. Specifically, the Dodd-Frank Act amended HMDA section 304(b)(4) by adding one new data point, the age of loan applicants and mortgagors.

Where must the notice of availability be located HMDA?

A financial institution shall post a general notice about the availability of its HMDA data in the lobby of its home office and of each branch office physically located in each MSA and each MD.

What regulation is Homeowners Protection Act?

The Homeowners Protection Act of 1998 is a law designed to reduce the unnecessary payment of private mortgage insurance (PMI) by homeowners who may no longer be required to pay it. The Homeowners Protection Act covers all private, residential mortgages purchased after July 29, 1999.

What is Trid compliance?

TRID: Purpose and History
TRID, or TILA-RESPA Information Disclosure, informs consumers applying for a mortgage and defines compliance rules for lenders. It is a consolidation of TILA (Truth in Lending) and RESPA (Real Estate Settlement Procedures Act) disclosures.

What was the public concern that inspired enactment of HMDA?

Purposes. HMDA grew out of public concern over credit shortages in certain urban neighborhoods. Congress believed that some financial institutions had contributed to the decline of some geographic areas by their failure to provide adequate home financing to qualified applicants on reasonable terms and conditions.

Where is HMDA data published?

Financial institution disclosure statements, MSA and nationwide aggregate reports for 2018 HMDA data, and tools to search and analyze the HMDA data are available at More information about HMDA data reporting requirements is also available at

What is redlining in real estate?

In the United States, redlining is the systematic denial of various services by federal government agencies, local governments as well as the private either directly or through the selective raising of prices.

When must HMDA data be collected?

If your credit union meets all four criteria, you must collect HMDA data during calendar year 2020 and submit the data to the CFPB no later than March 1, 2021. If your credit union does not meet all four criteria, you are exempt from filing HMDA data for calendar year 2020.