Revised Home Mortgage Disclosure Act Examination Procedures

HMDA
Examination Procedures
NARRATIVE
Home Mortgage Disclosure Act (HMDA)1
Background
The Home Mortgage Disclosure Act requires certain financial institutions to collect, report, and disclose information about their mortgage lending activity. HMDA was originally enacted by the Congress in 1975 and is implemented by Regulation C (12 CFR Part 1003). HMDA was enacted given public concern over credit shortages in certain neighborhoods. In particular, Congress believed that some financial institutions had contributed to the decline of various geographic areas through their failure to provide adequate home financing to qualified applicants on reasonable terms and conditions. Thus, one statutory purpose of HMDA is to provide the public with information that will help show whether financial institutions are serving the housing credit needs of the communities and neighborhoods in which they are located. A second statutory purpose is to aid public officials in distributing public sector investment so as to attract private investment to areas where it is needed. Finally, the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) amended HMDA to require the collection and disclosure of data about applicant and borrower characteristics to assist in identifying possible discriminatory lending patterns and enforcing antidiscrimination statutes. As the name implies, HMDA is a disclosure law that relies upon public scrutiny for its effectiveness. It does not prohibit any specific activity of lenders, and it does not establish a quota system of mortgage loans to be made in any geographic area. Between 1988 and 1992, Congress amended HMDA’s coverage. Coverage was expanded in the FIRREA amendments to include many independent nondepository mortgage lenders, in addition to the previously covered banks, savings associations, and credit unions. Coverage of independent mortgage bankers was further expanded by the Federal Deposit Insurance Corporation Improvement Act of 1991 HMDA amendments. For a more detailed discussion of the history of HMDA, see the Federal Financial Institutions Examination Council’s (FFIEC) website at www.ffiec.gov/hmda/history2.htm. Prior to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act), HMDA required financial institutions to report data regarding applications, loan originations, and loan purchases, as well as certain requests under a pre-approval program (as defined in Regulation C). HMDA also required financial institutions to report certain applicant and borrower demographic data, such as ethnicity, race, gender, and gross income. In addition, 1 12 USC 2801-2810. The HMDA Interagency Examination Procedures cover HMDA data collected in or after 2018, that is, for loans and applications for which final action was taken in or after 2018. April 2019 HMDA 1

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Examination Procedures the reporting of certain pricing information and the type of purchaser was required. Data was reported in a “register” reporting format, compiled by supervisory agencies, and disclosed to the public. The Dodd-Frank Act amended HMDA to, among other things, require reporting of additional data points, transfer HMDA rulemaking authority from the Board of Governors of the Federal Reserve System (Federal Reserve) to the Consumer Financial Protection Bureau (Bureau), and provide the Bureau with authority to mandate collection, recording, and reporting of such other information as the Bureau may require.2 In August 2014, the Bureau proposed amendments to Regulation C to implement the Dodd-Frank Act changes; to require collection, recording, and reporting of additional information to further HMDA’s purposes; and to modernize the manner in which covered financial institutions report HMDA data. The Bureau published a final rule amending Regulation C in October 2015 (2015 HMDA Rule).3 The Bureau published a final rule further amending Regulation C in September 2017 to facilitate implementation of the 2015 HMDA Rule (2017 HMDA Rule).4 Beginning in 2018, as discussed further below, the 2015 HMDA Rule requires that financial institutions continue to report data regarding applications, loan originations, and loan purchases. The Bureau’s 2015 HMDA Rule changed: (1) the definition of a financial institution that is subject to Regulation C; (2) the types of transactions that are subject to Regulation C; (3) the data that financial institutions are required to collect, record, and report pursuant to Regulation C; and (4) the processes for reporting and disclosing HMDA data. The data are submitted electronically to the Bureau on behalf of the appropriate Federal agency associated with the reporter, and most of the data are made available to the public on both an aggregate and a loanlevel basis.5 On May 24, 2018, the President signed the Economic Growth, Regulatory Relief, and Consumer Protection Act (2018 Act) into law.6 Effective May 24, 2018, Section 104(a) of the 2018 Act created partial exemptions from some of HMDA’s requirements for certain covered institutions. On August 31, 2018, the Bureau issued an interpretive and procedural rule (2018 HMDA Rule) 2 In December 2011, the Bureau restated the Federal Reserve’s existing Regulation C at 12 CFR Part
1003. See 76 Fed. Reg. 78465 (Dec. 19, 2011).
3 80 Fed. Reg. 66128 (Oct. 28, 2015).
4 82 Fed. Reg. 43088 (Sept. 13, 2017).
5 Information about the HMDA Platform through which financial institutions submit HMDA data to the Bureau to be processed and disclosed is available at https://ffiec.cfpb.gov/. 6 Pub. L. 115-174, 132 Stat. 1296 (2018), Section 104(a) (codified at 12 USC 2803). April 2019 HMDA 2

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Examination Procedures to implement and clarify Section 104(a) of the 2018 Act (2018 HMDA Rule). The 2018 HMDA Rule was published in the Federal Register on September 7, 2018.7 The Federal supervisory agencies use HMDA data to support a variety of activities. For example, some Federal supervisory agencies use HMDA data as part of their fair lending examination process,8 and other agencies use HMDA data in conducting Community Reinvestment Act examinations.9 Moreover, HMDA disclosures provide the public with information on the home mortgage lending activities of particular reporting entities and on activity in their communities. These disclosures are used by local, State, and Federal officials to evaluate housing trends and issues and by community organizations to monitor financial institution lending patterns. Because HMDA data serve numerous important purposes, validating the accuracy of HMDA data is a key element of the Federal supervisory agencies’ examination activities. Coverage A. Institutional Coverage Institutional Coverage Generally An institution is required to comply with Regulation C only if it is a financial institution as that term is defined in Regulation C. The definition of financial institution includes both depository financial institutions and nondepository financial institutions, as those terms are separately defined in Regulation C. 12 CFR 1003.2(g). An institution uses these two definitions, which are outlined below, as coverage tests to determine whether it is a financial institution that is required to comply with Regulation C. For the purpose of these examination procedures, the term financial institution refers to an institution that is either a depository financial institution or a nondepository financial institution that is subject to Regulation C. Institutional Coverage Tests Depository Financial Institutions A bank, savings association, or credit union is a depository financial institution and subject to Regulation C if it meets ALL of the following:
7 83 Fed. Reg. 45325 (Sept. 7, 2018).
8 15 USC 1691–1691f, 42 USC 3605, and 12 CFR Part 1002.
9 12 USC 2901–2908, and 12 CFR Parts 25, 195, 228, and 345.
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Asset-Size Threshold. On the preceding December 31, the bank, savings association, or
credit union had assets in excess of the asset-size threshold published annually in the Federal Register, as included in the Official Interpretations, 12 CFR Part 1003, Comment 2(g)-2, and posted on the Bureau’s website. 12 CFR 1003.2(g)(1)(i). The phrase “preceding December 31” refers to the December 31 immediately preceding the current calendar year. For example, in 2019, the preceding December 31 is December 31, 2018. Comment 2(g)-1.
Location Test. On the preceding December 31, the bank, savings association, or credit union
had a home or branch office located in a metropolitan statistical area (MSA). 12 CFR 1003.2(g)(1)(ii). For purposes of this location test, a branch office for a bank, savings association, or credit union is an office: (a) of the bank, savings association, or credit union (b) that is considered a branch by the institution’s Federal or State supervisory agency. For purposes of Regulation C, an automated teller machine or other free-standing electronic terminal is not a branch office regardless of whether the supervisory agency would consider it a branch. 12 CFR 1003.2(c)(1). A branch office of a credit union is any office where member accounts are established or loans are made, whether or not a Federal or State supervisory agency has approved the office as a branch. Comment 2(c)(1)-1.
Loan-Activity Test. During the preceding calendar year, the bank, savings association, or
credit union originated at least one home purchase loan or refinancing of a home purchase loan secured by a first lien on a one-to-four-unit dwelling. 12 CFR 1003.2(g)(1)(iii). For more information on whether a loan is secured by a dwelling, is a home purchase loan, or is a refinancing, see 12 CFR 1003.2(f), (j), and (p) and associated commentary.
Federally Related Test. The bank, savings association, or credit union:
a. Is federally insured; or b. Is federally regulated; or
c. Originated at least one home purchase loan or refinancing of a home purchase loan that
was secured by a first lien on a one-to-four-unit dwelling and also (i) was insured, guaranteed, or supplemented by a Federal agency or (ii) was intended for sale to the Federal National Mortgage Association (Fannie Mae) or the Federal Home Loan Mortgage Corporation (Freddie Mac). 12 CFR 1003.2(g)(1)(iv).
Loan-Volume Thresholds. The bank, savings association, or credit union meets or exceeds
either the closed-end mortgage loan or the open-end line of credit loan-volume threshold in each of the two preceding calendar years.

Effective January 1, 2018 and through December 31, 2019, a bank, savings association,
or credit union that originated at least 25 closed-end mortgage loans in each of the two preceding calendar years, or originated at least 500 open-end lines of credit in each of the two preceding calendar years meets or exceeds the loan-volume threshold.
Effective January 1, 2020, a bank, savings association, or credit union that originated at
least 25 closed-end mortgage loans in each of the two preceding calendar years, or April 2019 HMDA 4

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Examination Procedures originated at least 100 open-end lines of credit in each of the two preceding calendar years meets or exceeds the loan-volume threshold. When the bank, savings association, or credit union determines whether it meets these loanvolume thresholds, it does not count transactions excluded by 12 CFR 1003.3(c)(1) through (10) and (13). 12 CFR 1003.2(g)(1)(v). Closed-end mortgage loans, open-end lines of credit, and these excluded transactions are discussed below in TRANSACTIONAL COVERAGE. When determining if it meets the loan-volume thresholds, a bank, savings association, or credit union only counts closed-end mortgage loans and open-end lines of credit that it originated. Only one institution is deemed to have originated a specific closed-end mortgage loan or openend line of credit under Regulation C, even if two or more institutions are involved in the origination process. Only the institution that is deemed to have originated the transaction under Regulation C counts it for purposes of the loan-volume threshold. Comment 2(g)-5; see also comments 4(a)-2 through -4. These requirements are discussed below in TRANSACTIONS INVOLVING MULTIPLE ENTITIES. Regulation C also includes a separate test to ensure that financial institutions that meet only the closed-end mortgage loan threshold are not required to report their open-end lines of credit, and that financial institutions that meet only the open-end line of credit threshold are not required to report their closed-end mortgage loans. 12 CFR 1003.3(c)(11) and (12). Nondepository Financial Institutions Under Regulation C, a for-profit mortgage-lending institution other than a bank, savings association, or credit union is a nondepository financial institution and subject to Regulation C if it meets BOTH of the following:

Location Test. The institution had a home or branch office in a metropolitan statistical area
(MSA) on the preceding December 31. 12 CFR 1003.2(g)(2)(i). The phrase “preceding December 31” refers to the December 31 immediately preceding the current calendar year. For example, in 2019, the preceding December 31 is December 31, 2018. Comment 2(g)-1. For purposes of this location test, a branch office of a nondepository financial institution is any one of the institution’s offices at which the institution takes from the public applications for covered loans. A nondepository financial institution is also deemed to have a branch office in an MSA or a Metropolitan Division (MD) if, in the preceding calendar year, it received applications for, originated, or purchased five or more covered loans related to property located in that MSA, even if it does not have an office in that MSA or MD. 12 CFR 1003.2(c)(2). Covered loans and applications for covered loans are discussed below in TRANSACTIONAL COVERAGE.
Loan-Volume Thresholds. The institution meets or exceeds either the closed-end mortgage
loan threshold or the open-end line of credit threshold in each of the two preceding calendar years. April 2019 HMDA 5

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Effective January 1, 2018 through December 31, 2019, an institution that originated at
least 25 closed-end mortgage loans in each of the two preceding calendar years, or originated at least 500 open-end lines of credit in each of the two preceding calendar years meets or exceeds the loan-volume threshold.
Effective January 1, 2020, an institution that originated at least 25 closed-end mortgage
loans in each of the two preceding calendar years, or originated at least 100 open-end lines of credit in each of the two preceding calendar years meets or exceeds the loanvolume threshold. When an institution determines whether it meets the loan-volume thresholds, it does not count transactions excluded by 12 CFR 1003.3(c)(1) through (10) and (13). 12 CFR 1003.2(g)(2)(ii). Closed-end mortgage loans, open-end lines of credit, and these excluded transactions are discussed below in TRANSACTIONAL COVERAGE. When determining if it meets the loan-volume thresholds, an institution only counts closed-end mortgage loans and open-end lines of credit that it originated. Only one institution is deemed to have originated a specific closed-end mortgage loan or open-end line of credit under Regulation C, even if two or more institutions are involved in the origination process. Only the institution that is deemed to have originated the transaction under Regulation C counts it for purposes of the loan-volume threshold. Comment 2(g)-5. See also comments 4(a)-2 through -4. These requirements are discussed below in TRANSACTIONS WITH MULTIPLE ENTITIES. Regulation C also includes a separate test to ensure that financial institutions that meet only the closed-end mortgage loan threshold are not required to report their open-end lines of credit, and that financial institutions that meet only the open-end line of credit threshold are not required to report their closed-end mortgage loans. 12 CFR 1003.3(c)(11)–(12). B. Exemptions Based on State Law Regulation C provides that financial institutions may apply for an exemption from coverage. Specifically, the Bureau may exempt a State-chartered or State-licensed financial institution if the Bureau determines that the financial institution is subject to a State disclosure law that contains requirements substantially similar to those imposed by Regulation C and adequate enforcement provisions. Any State-licensed or State-chartered financial institution or association of such institutions may apply to the Bureau for an exemption. An exempt institution shall submit the data required by State law to its State supervisory agency. 12 CFR 1003.3(a). A financial institution that loses its exemption must comply with Regulation C beginning with the calendar year following the year for which it last reported data under the State disclosure law. 12 CFR 1003.3(b).
C. Transactional Coverage
A financial institution is required to collect, record, and report information only for transactions that are subject to Regulation C. April 2019 HMDA 6

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Examination Procedures
Covered Loans
A covered loan can be either a closed-end mortgage loan or an open-end line of credit, but an excluded transaction cannot be a covered loan. 12 CFR 1003.2(e). To determine if a transaction is subject to Regulation C, a financial institution should first determine whether the loan or line of credit involved in the transaction is either a closed-end mortgage loan or an open-end line of credit. See CLOSED-END MORTGAGE LOANS AND OPENEND LINES OF CREDIT, below. If the loan or line of credit is neither a closed-end mortgage loan nor an open-end line of credit, the transaction does not involve a covered loan, and the financial institution is not required to report information related to the transaction. If the loan or line of credit is either a closed-end mortgage loan or an open-end line of credit, the financial institution must determine if the closed-end mortgage loan or open-end line of credit is an excluded transaction. See EXCLUDED TRANSACTIONS, below. If the closed-end mortgage loan or the open-end line of credit is an excluded transaction, it is not a covered loan, and the financial institution is not required to report information related to the transaction. If the loan or line of credit is a closed-end mortgage loan or an open-end line of credit and is not an excluded transaction, the financial institution may be required to report information related to the transaction. See REPORTABLE ACTIVITY, below. Closed-End Mortgage Loans and Open-End Lines of Credit A closed-end mortgage loan is:
1. An extension of credit;
2. Secured by a lien on a dwelling; and
3. Not an open-end line of credit. 12 CFR 1003.2(d).
An open-end line of credit is:
1. An extension of credit;
2. Secured by a lien on a dwelling; and
3. An open-end credit plan for which:
a. The lender reasonably contemplates repeated transactions; b. The lender may impose a finance charge from time-to-time on an outstanding unpaid balance; and
c. The amount of credit that may be extended to the borrower during the term of the
plan (up to any limit set by the lender) is generally made available to the extent that any outstanding balance is repaid. 12 CFR 1003.2(o); 12 CFR 1026.2(a)(20). Financial institutions may rely on Regulation Z, 12 CFR 1026.2(a)(20), and its official commentary when determining whether a transaction is extended under a plan for which the lender reasonably contemplates repeated transactions, the lender may impose a finance charge from time-to-time on an outstanding unpaid balance, and the amount of credit that may be April 2019 HMDA 7

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Examination Procedures extended to the borrower during the term of the plan is generally made available to the extent that any outstanding balance is repaid. A business-purpose transaction that is exempt from Regulation Z but is otherwise open-end credit under Regulation Z, 12 CFR 1026.2(a)(20), would be an open-end line of credit under Regulation C if it is an extension of credit secured by a lien on a dwelling and is not an excluded transaction. Comment 2(o)-1. Extension of Credit A closed-end loan or open-end line of credit is not a closed-end mortgage loan or an open-end line of credit under Regulation C unless it involves an extension of credit. Individual draws on an open-end line of credit are not separate extensions of credit. Comment 2(o)-2. Under Regulation C,10 an “extension of credit” generally requires a new debt obligation. Comment 2(d)-2. Thus, for example, a loan modification where the existing debt obligation is not satisfied and replaced is not generally a covered loan (i.e., closed-end mortgage loan or openend line of credit) under Regulation C. Except as described below, if a transaction modifies, renews, extends, or amends the terms of an existing debt obligation, but the existing debt obligation is not satisfied and replaced, the transaction is not a covered loan. Regulation C provides two narrow exceptions to the requirement that an “extension of credit” involve a new debt obligation. The exceptions are designed to capture transactions that are substantially similar to new debt obligations and should be treated as such. First, assumptions are extensions of credit under Regulation C. A loan assumption is a transaction in which a financial institution enters into a written agreement accepting a new borrower in place of an existing borrower as the obligor on an existing debt obligation. Regulation C clarifies that assumptions include successor-in-interest transactions in which an individual succeeds the prior owner as the property owner and then assumes the existing debt secured by the property. Assumptions are extensions of credit even if the new borrower merely assumes the existing debt obligation and no new debt obligation is created. Comment 2(d)-2.i. Second, Regulation C provides that transactions completed pursuant to a New York State consolidation, extension, and modification agreement and classified as a supplemental mortgage under New York Tax Law Section 255, such that the borrower owes reduced or no mortgage recording taxes (New York CEMA), is an extension of credit. However, the regulation also provides that certain transactions providing new funds that are consolidated into a New York CEMA are excluded from the HMDA reporting requirements. Comment 2(d)-2.ii; 12 CFR 1003.3(c)(13). 10 It is important to note that Regulation C, comments 2(d)-2 and 2(o)-2, defines the phrase “extension of credit” differently than Regulation B, 12 CFR Part 1002.2(q). April 2019 HMDA 8

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Secured by a Lien on a Dwelling
A loan is not a closed-end mortgage loan and a line of credit is not an open-end line of credit unless it is secured by a lien on a dwelling. A dwelling is a residential structure. There is no requirement that the structure be attached to real property or that it be the applicant’s or borrower’s residence. Examples of dwellings include:
1. Principal residences;
2. Second homes and vacation homes;
3. Investment properties;
4. Residential structures whether or not attached to real property;
5. Detached residential structures;
6. Individual condominium and cooperative units;
7. Manufactured homes or other factory-built homes; and
8. Multifamily residential structures or communities, such as apartment buildings,
condominium complexes, cooperative buildings or housing complexes, and manufactured home communities. 12 CFR 1003.2(f); comments 2(f)-1 and -2. A dwelling is not limited to a structure that has four or fewer units. It also includes a multifamily dwelling, which is a dwelling that includes five or more individual dwelling units. A multifamily dwelling includes a manufactured home community. A loan related to a manufactured home community is secured by a dwelling even if it is not secured by any individual manufactured homes, but is secured only by the land that constitutes the manufactured home community. However, a loan related to a multifamily residential structure or community other than a manufactured home community is not secured by a dwelling unless it is secured by one or more individual dwelling units. For example, a loan that is secured only by the common areas of a condominium complex or only by an assignment of rents from an apartment building is not secured by a dwelling. Comment 2(f)-2. Further, a covered loan secured by five or more separate dwellings, which are not multifamily dwellings, in more than one location is not a loan secured by a multifamily dwelling. For example, assume a landlord uses a covered loan to improve five or more dwellings, each with one individual dwelling unit, located in different parts of a town, and the loan is secured by those properties. The covered loan is not secured by a multifamily dwelling as defined by § 1003.2(n). Likewise, a covered loan secured by five or more separate dwellings that are located within a multifamily dwelling, but which is not secured by the entire multifamily dwelling (e.g., an entire apartment building or housing complex), is not secured by a multifamily dwelling as defined by § 1003.2(n). For example, assume that an investor purchases 10 individual unit condominiums in a 100-unit condominium complex using a covered loan. The covered loan would not be secured by a multifamily dwelling as defined by § 1003.2(n). Comment 2(n)-3. The following are not dwellings:
1. Recreational vehicles, such as boats, campers, travel trailers, or park model recreational
vehicles;
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2. Houseboats, floating homes, or mobile homes constructed before June 15, 1976;
3. Transitory residences, such as hotels, hospitals, college dormitories, or recreational
vehicle parks; and
4. Structures originally designed as a dwelling but used exclusively for commercial
purposes, such as a home converted to a daycare facility or professional office. Comment 2(f)-3. A property that is used for both residential and commercial purposes, such as a building that has apartment and retail units, is a dwelling if the property’s primary use is residential. Comment 2(f)-4. A property used for both long-term housing and to provide assisted living or supportive housing services is a dwelling. However, transitory residences used to provide such services are not dwellings. Properties used to provide medical care, such as skilled nursing, rehabilitation, or long-term medical care, are not dwellings. If a property is used for long-term housing, to provide related services (such as assisted living), and to provide medical care, the property is a dwelling if its primary use is residential. Comment 2(f)-5. A financial institution may use any reasonable standard to determine a property’s primary use, such as square footage, income generated, or number of beds or units allocated for each use. It may select the standard on a case-by-case basis. Comments 2(f)-4 and -5. D. Excluded Transactions Regulation C does not apply to transactions that are specifically excluded from coverage. 12 CFR 1003.3(c). Therefore, an excluded transaction is not a covered loan. Regulation C retains and clarifies existing categories of transactions that are excluded from coverage. It also expands the existing exclusion for agricultural loans, and adds new categories of transactions that are excluded from coverage. Effective January 1, 2018, the following are excluded transactions:

A closed-end mortgage loan or an open-end line of credit that a financial institution
originates or purchases in a fiduciary capacity, such as a closed-end mortgage loan or an open-end line of credit that a financial institution originates or purchases as a trustee. 12 CFR 1003.3(c)(1); comment 3(c)(1).
A closed-end mortgage loan or an open-end line of credit secured by a lien on
unimproved land. 12 CFR 1003.3(c)(2). Generally, a loan or line of credit must be secured by a dwelling to be a covered loan. Regulation C also lists closed-end mortgage loans and open-end lines of credit secured only by vacant or unimproved land as excluded transactions.11 However, a loan or line of credit secured by a lien on 11 A dwelling also includes a multifamily residential structure or community such as an apartment, condominium, cooperative building or complex, or a manufactured home community. A loan related to a manufactured home community is secured by a dwelling for purposes of § 1003.2(f) even if it is not April 2019 HMDA 10

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Examination Procedures unimproved land is deemed to be secured by a dwelling (and might not be excluded) if the financial institution knows, based on information that it receives from the applicant or borrower at the time the application is received or the credit decision is made, that the proceeds of that loan or credit line will be used within two years after closing or account opening to construct a dwelling on, or to purchase a dwelling to be placed on, the land. Comment 3(c)(2)-1.
3. A closed-end mortgage loan or an open-end line of credit that is temporary financing. 12
CFR 1003.3(c)(3). A transaction is excluded as temporary financing if it is designed to be replaced by separate permanent financing extended to the same borrower at a later time. The separate permanent financing may be extended by any lender (i.e., by either the lender that extended the temporary financing or another lender). In addition, a construction-only loan or line of credit is considered temporary financing and excluded under Regulation C if the loan or line of credit is extended to a person exclusively to construct a dwelling for sale. Comments 3(c)(3)-1 and -2.
4. The purchase of an interest in a pool of closed-end mortgage loans or open-end lines of
credit, such as mortgage-participation certificates, mortgage-backed securities, or real estate mortgage investment conduits. 12 CFR 1003.3(c)(4); comment 3(c)(4)-1.
5. The purchase solely of the right to service closed-end mortgage loans or open-end lines
of credit. 12 CFR 1003.3(c)(5).
6. The purchase of a closed-end mortgage loan or an open-end line of credit as part of a
merger or acquisition or as part of the acquisition of all of a branch office’s assets and liabilities. 12 CFR 1003.3(c)(6); comment 3(c)(6)-1. For more information on mergers and acquisitions under Regulation C, see comments 2(g)-3 and -4.
7. A closed-end mortgage loan or an open-end line of credit, or an application for a closedend mortgage loan or open-end line of credit, for which the total dollar amount is less
than $500. 12 CFR 1003.3(c)(7).
8. The purchase of a partial interest in a closed-end mortgage loan or an open-end line of
credit. 12 CFR 1003.3(c)(8); comment 3(c)(8)-1.
9. A closed-end mortgage loan or an open-end line of credit if the proceeds are used
primarily for agricultural purposes or if the closed-end mortgage loan or open-end line of credit is secured by a dwelling that is located on real property that is used primarily for agricultural purposes. 12 CFR 1003.3(c)(9); comment 3(c)(9)-1. Regulation C directs financial institutions to Regulation Z’s official commentary for guidance on what is an agricultural purpose. Regulation Z’s official commentary states that agricultural secured by any individual manufactured homes, but only by the land that constitutes the manufactured home community including sites for manufactured homes. Comment 2(f)-2. April 2019 HMDA 11

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Examination Procedures purposes include planting, propagating, nurturing, harvesting, catching, storing, exhibiting, marketing, transporting, processing, or manufacturing food, beverages, flowers, trees, livestock, poultry, bees, wildlife, fish, or shellfish by a natural person engaged in farming, fishing, or growing crops, flowers, trees, livestock, poultry, bees, or wildlife. See comment 3(a)-8 in the official interpretations of Regulation Z, 12 CFR Part
1026. A financial institution may use any reasonable standard to determine the primary
use of the property, and may select the standard to apply on a case-by-case basis. Comment 3(c)(9)-1.
10. 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). Not all transactions that are primarily for a business purpose are excluded transactions. Thus, a financial institution must collect, record, and report data for dwelling-secured, business-purpose loans and lines of credit that are home improvement loans, home purchase loans, or refinancings if no other exclusion applies. For more information on determining whether a loan or line of credit is a home purchase loan, home improvement loan, or refinancing, see 12 CFR 1003.2(f), (i), (j), and (p) and the associated commentary. Regulation C provides that, if a closed-end mortgage loan or an open-end line of credit is deemed to be primarily for a business, commercial, or organizational purpose under Regulation Z, 12 CFR 1026.3(a) and its official commentary, then the loan or line of credit also is deemed to be primarily for a business or commercial purpose. Comment 3(c)(10)-2. For more information and examples of business-purpose or commercialpurpose transactions that are covered loans, see comments 3(c)(10)-3 and -4.
11. A closed-end mortgage loan if the financial institution originated fewer than 25 closedend mortgage loans in either of the two preceding calendar years. 12 CFR 1003.3(c)(11).
A financial institution is not required to collect, record, or report closed-end mortgage loans if it originated fewer than 25 of them in either of the two preceding calendar years. However, the financial institution may still be required to collect and report information regarding open-end lines of credit, depending on the number of open-end lines of credit it originates in the preceding two calendar years. Comment 3(c)(11)-1. For more information on how to determine if a financial institution “originated” a particular loan when multiple entities are involved in the transaction, see comments 4(a)-2 through -4. A financial institution may report applications for, originations of, and purchases of closed-end mortgage loans that are excluded transactions under 12 CFR 1003.3(c)(11). However a financial institution that chooses to report such excluded applications, originations, and purchases must report all such applications it received for closed-end mortgage loans, all closed-end mortgage loans it originates, and all closed-end mortgage loans it purchases that would otherwise be covered loans for a given calendar year. 12 CFR 1003.3(c)(11). Regulation B permits a financial institution to collect information regarding the ethnicity, race, and sex of an applicant for a closed-end mortgage loan that April 2019 HMDA 12

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Examination Procedures is an excluded transaction under 12 CFR 1003.3(c)(11), if the financial institution submits HMDA data concerning such closed-end mortgage loans and applications or if it submitted such HMDA data for any of the preceding five calendar years.12
12. An open-end line of credit if the number of open-end lines of credit that the financial
institution originated in either of the two preceding calendar years does not meet or exceed the applicable threshold. 12 CFR 1003.3(c)(12); comment 3(c)(12)-1. Effective January 1, 2018 until December 31, 2019, the applicable threshold is 500 open-end lines of credit. During this time period, a financial institution is not required to collect, record, or report open-end lines of credit if it originated fewer than 500 of them in either of the two preceding calendar years. Effective January 1, 2020, the applicable threshold will be 100 open-end lines of credit. Effective January 1, 2020, a financial institution is not required to collect, record, and report open-end lines of credit if it originated fewer than 100 of them in either of the two preceding calendar years. Comment 3(c)(12)-1. However, the financial institution will still be required to collect and report information regarding closed-end mortgage loans if it originated at least 25 of them in each of the two preceding calendar years. Comment 3(c)(12)-1. For more information on how to determine if a financial institution “originated” a particular line of credit when multiple entities are involved in the transaction, see comments 4(a)-2 through -4. A financial institution may report applications for, originations of, or purchases of openend lines of credit that are excluded transactions under 12 CFR 1003.3(c)(12). However, a financial institution that chooses to report such excluded applications, originations, or purchases must report all applications for otherwise covered open-end lines of credit that it receives, all otherwise covered open-end lines of credit it originates, and all otherwise covered open-end lines of credit it purchases that would otherwise be covered loans for a given calendar year. 12 CFR 1003.3(c)(12); comment 3(c)(12)-2. Regulation B permits a financial institution to collect information regarding the ethnicity, race, and sex of an applicant for an open-end line of credit that is an excluded transaction under 12 CFR 1003.3(c)(12), if it submits HMDA data concerning such open-end lines of credit and applications or if it submitted such HMDA data for any of the preceding five calendar years.13
13. A transaction that provided (or, in the case of an application, proposed to provide) new
funds to the borrower in advance of being consolidated in a New York CEMA classified as a supplemental mortgage under New York Tax Law Section 255. However, the transaction is excluded only if final action on the consolidation was taken in the same calendar year as the final action on the new funds transaction. 12 CFR 1003.3(c)(13). 12 Amendments to Equal Credit Opportunity Act (Regulation B) Ethnicity and Race Information Collection. 82 Fed. Reg. 45680 (Oct. 2, 2017) (October 2017 Regulation B Amendments). This final rule amends Regulation B to allow creditors flexibility in complying with Regulation B to facilitate compliance with Regulation C and transition to the 2016 Uniform Residential Loan Application (URLA). 13 October 2017 Regulation B Amendments. April 2019 HMDA 13

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Additionally, the transaction is excluded only if, at the time that it originated the transaction providing the new funds, the financial institution intended to consolidate the loan into a New York CEMA. This exclusion does not apply to similar preliminary transactions that are consolidated pursuant to laws other than New York Tax Law Section
255. Such preliminary transactions under other laws must be reported if they are covered
loans and are not covered by another exclusion. Comment 3(c)(13)-1.
New funds provided in advance of being consolidated into a New York CEMA classified as a supplemental mortgage under New York Tax Law Section 255 are reported only insofar as they form part of the total amount of the reported New York CEMA. They are not reported as a separate amount. If a New York CEMA that consolidates an excluded preliminary transaction is carried out in a transaction involving an assumption, the financial institution reports the New York CEMA and does not report the preliminary transaction separately. Comment 3(c)(13)-1. Reportable Activity Once a financial institution has determined whether a transaction involves a covered loan, it must determine whether it has engaged in activity that obligates it to report information about the transaction. Generally, a financial institution is required to report information for actions taken on applications (as that term is defined below) for covered loans, originations of covered loans, and purchases of covered loans. If a financial institution receives an application and that application results in the financial institution originating a covered loan, the financial institution reports the origination of the covered loan, and does not separately report the application. For more information on when to report information regarding applications and covered loans, see APPLICATIONS and ORIGINATIONS AND PURCHASES OF COVERED LOANS, below. There are special rules that apply if multiple entities are involved in the transaction. These special rules are discussed in TRANSACTION INVOLVING MULTIPLE ENTITIES, below. There are also partial exemptions for which the financial institution would not be required to collect, record, or report certain data points for the transaction that qualifies for the partial exemption. These partial exemptions are discussed below in PARTIAL EXEMPTIONS. A. Applications For purposes of Regulation C, an application is: (a) an oral or written request (b) for a covered loan (c) that is made in accordance with procedures the financial institution uses for the type of credit requested. 12 CFR 1003.2(b)(1). This definition of application is similar to the Regulation B definition, except that prequalification requests are not applications under Regulation C. Interpretations that appear in the official commentary to Regulation B are generally applicable to the definition of application under Regulation C, except for those interpretations that include a prequalification request within the definition of application. Comment 2(b)-1. April 2019 HMDA 14

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Under Regulation C, a request for a preapproval may be treated differently than a request for a prequalification for certain types of loans. The determination of whether a request is a prequalification request (which is not an application) or a preapproval request (which might be an application) is based on Regulation C, not on the labels that a financial institution uses or interpretations of other regulations, such as Regulation B. A preapproval request is an application under Regulation C if the request is:
1. For a home purchase loan;
2. Not secured by a multifamily dwelling;
3. Not for an open-end line of credit or for a reverse mortgage; and
4. Reviewed under a preapproval program (see definition of preapproval program
immediately below). 12 CFR 1003.2(b)(2).
A preapproval program for purposes of Regulation C is a program in which the financial institution:
1. Conducts a comprehensive analysis of the applicant’s creditworthiness (including income
verification), resources, and other matters typically reviewed as part of the financial institution’s normal credit evaluation program; and then
2. Issues a written commitment that: (a) is for a home purchase loan; (b) is valid for a
designated period of time and up to a specified amount; and (c) is subject only to specifically permitted conditions. 12 CFR 1003.2(b)(2); comment 2(b)-3. The written commitment issued as part of the preapproval program can be subject to only the following types of conditions:
1. Conditions that require the identification of a suitable property;
2. Conditions that require that no material change occur regarding the applicant’s financial
condition or creditworthiness prior to closing; and
3. Limited conditions that (a) are not related to the applicant’s financial condition or
creditworthiness and (b) the financial institution ordinarily attaches to a traditional home mortgage application. Examples of conditions ordinarily attached to a traditional home mortgage application include requiring an acceptable title insurance binder or a certificate indicating clear termite inspection and, if the applicant plans to use the proceeds from the sale of the applicant’s present home to purchase a new home, a settlement statement showing adequate proceeds from the sale of the present home. 12 CFR 1003.2(b)(2); comment 2(b)-3. A program that a financial institution describes as a “preapproval program” but that does not satisfy the Regulation C definition is not a preapproval program for purposes of the regulation. Comment 2(b)-3. If a financial institution does not regularly use procedures to consider requests but instead considers requests on an ad hoc basis, the financial institution is not required to treat the ad hoc requests as having been reviewed under a preapproval program. However, a financial institution April 2019 HMDA 15

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Examination Procedures should be generally consistent in following uniform procedures for considering such ad hoc requests. Comment 2(b)-3. Under Regulation C, a financial institution must collect, record, and report data regarding an application it receives if: (1) the application did not result in the financial institution originating a covered loan; and (2) the financial institution took action on the application or the applicant withdrew the application while the financial institution was reviewing it. For example, a financial institution reports information regarding an application that it denied, that it approved but the applicant did not accept, or that it closed for incompleteness. 12 CFR 1003.4(a), 1003.5(a) comment 4(a)-1. If the application results in the financial institution originating a covered loan, the financial institution reports the covered loan, not the application itself. For more information on reporting applications when multiple entities are involved, see TRANSACTIONS INVOLVING MULTIPLE ENTITIES, below. Although requests under preapproval programs are applications, a financial institution reports data regarding a request under a preapproval program only if the preapproval request is denied or approved but not accepted. A financial institution will also report a request under a preapproval program that results in the financial institution originating a home purchase loan, but it will be reported as an originated covered loan. Comment 4(a)-1.ii. A financial institution reports the data for an application, including a reportable preapproval request, on the HMDA Loan/Application Register (LAR) for the calendar year during which it takes action even if the financial institution received the application in a previous calendar year. Comment 4(a)-1.iv. B. Originations and Purchases of Covered Loans A financial institution must collect, record, and report information regarding originations and purchases of covered loans. For more information on when a financial institution reports the origination or purchase of a covered loan when multiple entities are involved, see TRANSACTIONS INVOLVING MULTIPLE ENTITIES, below. A purchase includes a repurchase of a covered loan, regardless of whether the financial institution chose to repurchase the covered loan or was required to repurchase it because of a contractual obligation, and regardless of whether the repurchase occurred within the same calendar year that the covered loan was originated or in a different calendar year. Comment 4(a)-5. A purchase does not include a temporary transfer of a covered loan to an interim funder or warehouse creditor as part of an interim funding agreement under which the financial institution that originated the covered loan is obligated to repurchase it for sale to a subsequent investor. Such funding agreements are often referred to as repurchase agreements and are sometimes used as the functional equivalents of warehouse lines of credit. Comment 4(a)-5.
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C. Transactions Involving Multiple Entities
Only one financial institution reports the origination of a covered loan. If more than one institution is involved in the origination of a covered loan, the institution that makes the credit decision approving the application before loan closing or account opening is responsible for reporting the origination of the covered loan. It is not relevant whether the loan closed in the reporting financial institution’s name. If more than one institution approved an application prior to loan closing or account opening and one of those institutions purchased the covered loan after closing or account opening, the institution that purchased the covered loan after closing or account opening is responsible for reporting the origination of the covered loan. Comment 4(a)- 2.i. If a financial institution reports a covered loan as an origination, it reports all of the information required to be reported for the origination of a covered loan, even if the covered loan was not initially payable to the financial institution that is reporting the covered loan as an origination. Comment 4(a)-2. When reporting a covered loan as an origination, a financial institution cannot rely on exceptions or exclusions that apply to purchased covered loans, but that do not apply to originations of covered loans. In the case of an application that did not result in an origination, a financial institution reports the action that it took on that application if it made a credit decision on the application or was reviewing the application when the application was withdrawn or the file was closed for incompleteness. Comment 4(a)-2.ii. If a financial institution makes a credit decision on a covered loan or application through the actions of an agent, the financial institution reports the covered loan or application. State law determines whether one party is the agent of another party. Comment 4(a)-4. D. Partial Exemptions The 2018 Act created partial exemptions from some of the 2015 HMDA Rule’s requirements for certain financial institutions. Only certain covered loans and applications are covered under each of the two partial exemptions. If a covered loan or application is covered by a partial exemption, the financial institution is not required to collect, record, and report specific data points. The partial exemptions were effective May 24, 2018, and apply to the collection, recording, and reporting of HMDA data on or after that date. A list of the data points covered by the partial exemptions is provided below. See 2019 A Guide to HMDA Reporting: Getting It Right!
Appendix G for a list of both the partially exempt data points and corresponding data fields.
As discussed below, only a financial institution that is an insured credit union or an insured depository institution is eligible for the partial exemptions. Additionally, as explained below, in order to be eligible for the partial exemptions, an insured depository institution must not have April 2019 HMDA 17

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Examination Procedures received certain ratings in its most recent performance evaluations under the Community Reinvestment Act (CRA).14 As discussed below, each of the partial exemptions applies only to certain covered loans and applications and only if an applicable loan-volume threshold is met. An insured depository institution or insured credit union: (1) must meet the applicable loan-volume threshold for closed-end mortgage loans in order for a partial exemption to apply to its closed-end mortgage loan transactions; and (2) must meet the applicable loan-volume threshold for open-end lines of credit in order for a partial exemption to apply to its open-end line of credit transactions. The 2018 Act created partial exemptions, not complete exclusions. Therefore, if a covered loan or application is covered by a partial exemption, the financial institution is required to collect, record, and report 22 specific data points specified in 12 CFR 1003.4(a)(1)-(38), but is exempt from collecting, recording, and reporting 26 other specific data points for that transaction. Additionally, the financial institution may voluntarily report any or all of these remaining 26 data points for a covered loan or application covered by a partial exemption. COLLECTING, RECORDING, AND REPORTING FOR TRANSACTIONS COVERED BY A PARTIAL EXEMPTION, below, discusses the scope of the partial exemptions and includes tables that list both the 22 data points that are required to be collected, recorded, and reported and the 26 data points that are not required to be collected, recorded, and reported if a partial exemption applies to a covered loan or application. Eligible Financial Institutions In order to be eligible for a partial exemption, a financial institution must be an:
1. “Insured credit union,” as defined in Section 101 of the Federal Credit Union Act, 12
USC 1752; or
2. “Insured depository institution,” as defined in Section 3 of the Federal Deposit Insurance
Act, 12 USC 1813.
Additionally, a financial institution that satisfies the definition of “insured depository institution” must not have received a less than satisfactory rating in its most recent CRA performance evaluations in order to be eligible for a partial exemption. More specifically, an insured depository institution must not have received either of the following:
1. A rating of “needs to improve record of meeting community credit needs” during
each of its two most recent examinations under Section 807(b)(2) of the CRA; or 14 Partial Exemptions From the Requirements of the Home Mortgage Disclosure Act Under the Economic Growth, Regulatory Relief, and Consumer Protection Act (Regulation C), 83 Fed. Reg. 45325 (Sept. 7, 2018). April 2019 HMDA 18

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2. A rating of “substantial noncompliance in meeting community credit needs” on its
most recent examination under Section 807(b)(2) of the CRA.
The CRA ratings used to determine if an insured depository institution is eligible for a partial exemption are the institution’s two most recent ratings as of December 31 of the preceding year. A financial institution that does not satisfy either the definition of an “insured credit union” or an “insured depository institution” may not rely on either of the partial exemptions, even if it satisfies the loan-volume thresholds discussed in LOAN-VOLUME THRESHOLDS, below. Similarly, an insured depository institution that does not satisfy the criteria regarding CRA examination history cannot rely on either of the partial exemptions. Loan-Volume Thresholds In order for a partial exemption to apply to an application or covered loan (including a purchased covered loan), an eligible financial institution must also meet the applicable loan-volume threshold. A partial exemption applies to an eligible financial institution’s applications for, originations of, and purchases of closed-end mortgage loans if the institution originated fewer than 500 closedend mortgage loans in each of the two preceding calendar years. When a financial institution determines whether it meets the loan-volume thresholds for a partial exemption, it does not count transactions excluded by 12 CFR 1003.3(c)(1) through (10) and (13). A partial exemption applies to an eligible financial institution’s applications for, originations of, and purchases of open-end lines of credit if the institution originated fewer than 500 open-end lines of credit in each of the two preceding calendar years. However, during 2018 and 2019, a financial institution is not required to collect or report any information for open-end lines of credit if the institution originated fewer than 500 open-end lines of credit during either of the two preceding calendar years. This is because, during 2018 and 2019, open-end lines of credit are excluded transactions for a financial institution that originated fewer than 500 open-end lines of credit during either of the two preceding calendar years. See the discussion regarding excluded transactions in TRANSACTIONAL COVERAGE, above. The partial exemption for closed-end mortgage loans and the partial exemption for open-end lines of credit operate independently of one another. Thus, in a given calendar year, an eligible financial institution may be able to rely on one or both partial exemptions. Collecting, Recording, and Reporting for Transactions Covered by a Partial Exemption If a partial exemption applies to a covered loan or application (as discussed above), the financial institution is not required to collect, record, and report some of the data points that the 2015 HMDA Rule would otherwise require the institution to collect, record, and report for that transaction. More specifically, if a partial exemption applies to a covered loan or application, a April 2019 HMDA 19

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Examination Procedures financial institution is not required under the HMDA Rule to collect, record, or report the 26 data points listed in the table immediately below. Data Points Eligible Financial Institutions Need Not Collect or Report under the 2018 HMDA Rule For Transactions Covered by a Partial Exemption

Universal Loan Identifier (ULI) (1003.4(a)(1)(i))15
Application Channel (1003.4(a)(33))
Loan Term (1003.4(a)(25))
Reasons for Denial (1003.4(a)(16))16
Property Address (1003.4(a)(9)(i))
Manufactured Home Secured Property Type (1003.4(a)(29))
Manufactured Home Land Property Interest (1003.4(a)(30))
Property Value (1003.4(a)(28))
Multifamily Affordable Units (1003.4(a)(32))
Debt-to-Income Ratio (1003.4(a)(23))
Combined Loan-to-Value Ratio (1003.4(a)(24))
Credit Score (1003.4(a)(15))
Automated Underwriting System (1003.4(a)(35))
Interest Rate (1003.4(a)(21))
Introductory Rate Period (1003.4(a)(26))
Rate Spread (1003.4(a)(12))
Non-Amortizing Features (1003.4(a)(27))
Total Loan Costs or Total Points and Fees (1003.4(a)(17))
Origination Charges (1003.4(a)(18))
Discount Points (1003.4(a)(19))
Lender Credits (1003.4(a)(20))
Prepayment Penalty Term (1003.4(a)(22))
Reverse Mortgage Flag (1003.4(a)(36))
Open-End Line of Credit Flag (1003.4(a)(37))
Business or Commercial Purpose Flag (1003.4(a)(38))
Mortgage Loan Originator Identifier (1003.4(a)(34))
15 If the financial institution chooses not to report a ULI for a covered loan or application covered by a partial exemption, it must report a non-universal loan identifier. 16 Financial institutions supervised by the Office of the Comptroller of the Currency (OCC) are required to report reasons for denial on their HMDA loan/application registers (HMDA LARs), even if a partial exemption applies. 12 CFR 27.3(a)(1)(i), 128.6. Similarly, pursuant to regulations transferred from the Office of Thrift Supervision, certain financial institutions supervised by the Federal Deposit Insurance Corporation (FDIC) are required to report reasons for denial on their HMDA LARs, even if a partial exemption applies. 12 CFR 390.147. April 2019 HMDA 20

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A financial institution may opt to collect, record, and report one or more of these 26 data points for a covered loan or application that is covered by a partial exemption. Seven of these 26 data points (i.e., property address, credit score, reasons for denial, total loan costs or total points and fees, non-amortizing features, application channel, and automated underwriting system) have multiple data fields. If a financial institution opts to report a data point with multiple fields, it must report all of the data fields that make up that data point. If a financial institution opts not to report one of the 26 data points other than the ULI, the financial institution generally reports that the covered loan or application is exempt from that data point. However, if a data point is not applicable to the particular transaction and the transaction is exempt from that data point, the financial institution may choose to report either that the data point is not applicable or that the transaction is exempt from the data point. If a covered loan or application is covered by a partial exemption, a financial institution must collect, record, and report 22 data points for the covered loan or application. These 22 data points are set forth in the following table. Data Points That Must be Collected and Reported under the 2018 HMDA Rule for Covered Loans and Applications Covered by a Partial Exemption

Ethnicity (1003.4(a)(10)(i))
Race (1003.4(a)(10)(i))
Sex (1003.4(a)(10)(i))
Age (1003.4(a)(10)(ii))
Income (1003.4(a)(10)(iii))
Legal Entity Identifier (LEI) (1003.5(a)(3))
Application Date (1003.4(a)(1)(ii)
Preapproval (1003.4(a)(4))
Loan Type (1003.4(a)(2))
Loan Purpose (1003.4(a)(3))
Loan Amount (1003.4(a)(7))
Action Taken (1003.4(a)(8)(i))
Action Taken Date (1003.4(a)(8)(ii))
State (1003.4(a)(9)(ii)(A))
County (1003.4(a)(9)(ii)(B))
Census Tract (1003.4(a)(9)(ii)(C))
Construction Method (1003.4(a)(5))
Occupancy Type (1003.4(a)(6)
Lien Status (1003.4(a)(14))
Number of Units (1003.4(a)(31))
HOEPA Status (1003.4(a)(13))
Type of Purchaser (1003.4(a)(11))
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Because the partial exemptions do not affect these 22 data points, financial institutions must continue to collect, record, and report these 22 data points for covered loans and applications in the manner specified in the 2015 HMDA Rule, as amended and clarified by the 2017 HMDA Rule. As discussed above, during 2018 and 2019, a financial institution is not required to collect or report any information for open-end lines of credit if the institution originated fewer than 500 open-end lines of credit during either of the two preceding calendar years. See the discussion regarding excluded transactions in TRANSACTIONAL COVERAGE, above. For more information on reporting data points if a covered loan or application is covered by a partial exemption, see the following COMPILATION OF LOAN DATA section of these procedures and the Filing Instructions Guide that incorporates the 2018 HMDA Rule available at http://www.consumerfinance.gov/data-research/hmda/for-filers. Compilation of Loan Data Attachment A is a summary of the data points required to be collected, recorded, and reported beginning in 2018 and provides information on where to find specific guidance in the regulation and commentary on what should be included for each data point.17 Additional information on the data fields and codes used in preparing the HMDA LAR is provided in the HMDA Filing Instructions Guide (FIG) available at https://ffiec.cfpb.gov/. 18 Reporting A. Recording Regulation C requires a financial institution to record the data about a covered loan or application on a HMDA LAR within 30 calendar days after the end of the calendar quarter in which the financial institution takes final action on the covered loan or application. 12 CFR 1003.4(f). A financial institution is not required to record all of its HMDA data for a quarter on a single HMDA LAR. Rather, a financial institution may record data on a single HMDA LAR or may record data on one or more HMDA LARs for different branches or different loan types (such as home purchase loans or home improvement loans or loans on multifamily dwellings). Comment 4(f)-1. 17 Each data point may correspond to more than one field reported on the HMDA LAR. Accordingly there are 48 data points described in Regulation C and 110 fields reported on the HMDA LAR. One example of a data point that corresponds to multiple fields is the ethnicity data point. Each applicant and co-applicant may enter up to five ethnicities on their application. See 12 CFR 1003.4(a)(10)(i); Appendix B to Part 1003. 18 The FIG, available at https://ffiec.cfpb.gov, contains the file specifications, edit specifications, and additional resources for filing HMDA data collected in or after 2018. April 2019 HMDA 22

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Other State or Federal regulations may require a financial institution to record its data on a HMDA LAR more frequently. Comment 4(f)-2. Financial institutions may maintain their quarterly records in electronic or any other format, provided they can make the information available to their regulatory agencies in a timely manner upon request. Comment 4(f)-3. B. Reporting In addition to the required data discussed in 12 CFR 1003.4(a) and (b), effective January 1, 2019, a financial institution must include the following when it submits its HMDA data:

Its name;
The calendar year and, effective January 1, 2020, if applicable, the calendar quarter to
which the data relate (see 12 CFR 1003.5(a)(1)(ii)19 for information on quarterly reporting);
The name and contact information for a person who can be contacted with questions
about the submission;
The financial institution’s appropriate Federal agency;
The total number of entries in the submission;
The financial institution’s Federal Taxpayer Identification Number (TIN); and
The financial institution’s Legal Entity Identifier (LEI). 12 CFR 1003.5(a)(3).
If the appropriate Federal agency for a financial institution changes, the financial institution must identify its new appropriate Federal agency in its annual submission for the year of the change. Comment 5(a)-2. For example, if a financial institution’s appropriate Federal agency changes in February 2018, it must identify its new appropriate Federal agency beginning with its annual submission of 2018 data by March 1, 2019. Comment 5(a)-5. For a financial institution required to comply with quarterly reporting requirements (see 12 CFR 1003.5(a)(1)(ii)), the financial institution also must identify its new appropriate Federal agency in its quarterly submission beginning with its submission for the quarter of the change, unless the change occurs during the fourth quarter (in which case, the financial institution would identify the new appropriate Federal agency in its annual submission). For example, if the appropriate Federal agency for a financial institution changes during February 2020, the financial institution must identify its new appropriate Federal agency beginning with its quarterly submission for the first quarter of 2020. Comment 5(a)-2. If a financial institution obtains a new TIN, it must provide the new TIN in its subsequent data submissions. For example, if two financial institutions that previously reported HMDA data merge and the surviving financial institution retained its LEI but obtained a new TIN, the surviving financial institution reports the new TIN beginning with its next HMDA data submission. Comment 5(a)-5. 19 The quarterly reporting requirement, 12 CFR 1003.5(a)(1)(ii), becomes effective January 1, 2020. April 2019 HMDA 23

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A financial institution that is a subsidiary of a bank or savings association must complete its own HMDA LAR and submit it, directly or through its parent, to the appropriate Federal agency for the subsidiary’s parent. 12 CFR 1003.5(a)(2). A financial institution is a subsidiary of a bank or savings association (for purposes of reporting HMDA data to the same agency as the parent) if the bank or savings association holds or controls an ownership interest in the financial institution that is greater than 50 percent. Comment 5(a)-3.
C. Annual Reporting
Regulation C maintains the annual reporting requirement, but requires financial institutions to submit data electronically in accordance with the procedures published by the Bureau. 12 CFR 1003.5(a)(5). These procedures do not provide detailed information about the HMDA submission process or file, data, and edit specifications. Information about those topics can be found on the FFIEC’s web pages available at https://ffiec.cfpb.gov and https://www.ffiec.gov/hmda/. Under Regulation C, a financial institution must submit its annual HMDA LAR in electronic format to its appropriate Federal supervisory agency by March 1 of the year following the calendar year for which the data are collected. 12 CFR 1003.5(a)(1)(i). An individual who is an authorized representative of the financial institution and who has knowledge regarding the submitted data must certify its accuracy and completeness. 12 CFR 1003.5(a)(1)(i). A financial institution must retain a copy of its submitted annual HMDA LAR for at least three years. 12 CFR 1003.5(a)(1)(i). Financial institutions may retain their annual HMDA LARs in either paper or electronic form. Comment 5(a)-4. For more information on reporting under Regulation C or on the electronic submission of data, please see https://ffiec.cfpb.gov. D. Quarterly Reporting The HMDA Rule requires some financial institutions to report data on a quarterly basis as well as on an annual basis. The quarterly reporting requirement is effective January 1, 2020. It applies to a financial institution that reported at least 60,000 originated covered loans and applications (combined) for the preceding calendar year. The financial institution does not count purchased covered loans when determining whether the quarterly reporting requirement applies. If quarterly reporting is required, the financial institution must report all data required to be recorded for the calendar quarter within 60 calendar days after the end of the calendar quarter. The quarterly reporting requirement does not apply, however, to the fourth quarter of the year. A financial institution subject to the quarterly reporting requirement reports its fourth quarter data as part of its annual submission. In its annual submission, a quarterly reporter will resubmit the data previously submitted for the first three calendar quarters of the year, including any corrections to the data, as well as its fourth quarter data. 12 CFR 1003.5(a)(1)(ii). April 2019 HMDA 24

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Disclosure of Data
A. Disclosure Statement
Under Regulation C, the FFIEC shall provide a notice to the financial institution that the financial institution’s disclosure statement (aggregated data derived from loan-level data submitted for the prior calendar year) is available. 12 CFR 1003.5(b)(1). No later than three business days (any calendar day other than a Saturday, Sunday, or legal public holiday) after receiving notice from the FFIEC, the financial institution must make available to the public, upon request, a written notice that clearly conveys that the financial institution’s disclosure statement may be obtained on the Bureau’s website at http://www.consumerfinance.gov/hmda. 12 CFR 1003.5(b)(2); comment 5(b)-1. A financial institution’s disclosure statement may also be obtained from https://ffiec.cfpb.gov. A financial institution may, but is not required to, use the sample notice to satisfy Regulation C’s disclosure statement requirement. The notice may be made available in paper or electronic form. Comment 5(b)-2. A financial institution must make the notice available to the public for a period of five years. 12 CFR 1003.5(d)(1). At its discretion, a financial institution may also provide its disclosure statement and impose a reasonable fee for costs incurred reproducing or providing the statement. 12 CFR 1003.5(d)(2). Even if it provides the disclosure statement, a financial institution must comply with the notice requirement. B. Modified HMDA LAR20 Upon request from a member of the public, a financial institution must provide a written notice regarding the availability of its modified HMDA LAR (the financial institution’s HMDA LAR, as modified by the Bureau to protect applicant and borrower privacy). 12 CFR 1003.5(c). The written notice must clearly convey that the financial institution’s HMDA LAR, as modified by the Bureau to protect borrower and applicant privacy, may be obtained on the Bureau’s website at http://www.consumerfinance.gov/hmda. A financial institution’s HMDA LAR is also available at https://ffiec.cfpb.gov. A financial institution may, but is not required to, use the sample notice in comment 5(c)-2 to the regulation to satisfy Regulation C’s modified HMDA LAR requirement. Comment 5(c)-2. A financial institution may, but is not required to, use the same notice for purposes of this disclosure requirement and the disclosure statement requirement discussed in the DISCLOSURE 20 The Bureau’s final policy guidance describing the modifications it will make to protect consumer privacy for data collected in 2018 and reported in 2019 is available at https://www.consumerfinance.gov/about-us/newsroom/consumer-financial-protection-bureau-announcespolicy-guidance-disclosure-home-mortgage-data/. April 2019 HMDA 25

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Examination Procedures
STATEMENT section above. The notice may be made available in paper or electronic form. Comment 5(c)-1. The notice must be made available in the calendar year following the calendar year for which the financial institution collected data. 12 CFR 1003.5(d)(1). The notice must be made available for three years. For example, for data that it was required to collect in 2018 a financial institution must make available a notice through calendar year 2021 that its modified HMDA 2018 LAR is available. At its discretion, a financial institution may also provide its HMDA LAR, as modified by the Bureau, and impose a reasonable fee for any costs incurred to reproduce or provide the data. 12 CFR 1003.5(d)(2). Even if it decides to provide the modified HMDA LAR, a financial institution must comply with the notice requirement.
C. Posted Notices
A financial institution must post, in the lobby of its home office and each branch office physically located in an MSA or Metropolitan Division (MD), a general notice about the availability of its HMDA data on the Bureau’s website. 12 CFR 1003.5(e). A financial institution may, but is not required to, use the sample notice in comment 5(e)-1 to the regulation to satisfy this requirement. In any case, the notice must clearly convey that the financial institution’s HMDA data are available on the Bureau’s website at http://www.consumerfinance.gov/hmda. Comment 5(e)-1. D. Aggregated data The FFIEC will use the annual data submitted pursuant to Regulation C to make available aggregated data for each MSA and MD, showing lending patterns by property location, age of housing stock, and income level, sex, ethnicity, and race. 12 CFR 1003.5(f). Administrative Enforcement A violation of Regulation C is subject to administrative sanctions, including civil money penalties. Compliance can be enforced by the Bureau, the FDIC, the Federal Reserve, the National Credit Union Administration, the OCC, or the U.S. Department of Housing and Urban Development. An error in compiling or recording data for a covered loan or application is not a violation of HMDA or Regulation C if the error was unintentional and occurred despite maintenance of procedures reasonably adapted to avoid such errors. 12 CFR 1003.6(b)(1). However, a financial institution that obtains the property-location information for applications and covered loans from third parties is responsible for ensuring that the information reported is correct. Comment 6(b)-

An incorrect entry for a census tract number is deemed a bona fide error and is not a violation
April 2019 HMDA 26

HMDA
Examination Procedures if the financial institution maintains procedures reasonably adapted to avoid such an error. 12 CFR 1003.6(b)(2). If an institution makes a good faith effort to record all data concerning covered transactions fully and accurately within 30 calendar days after the end of each calendar quarter, and some data are nevertheless inaccurate or incomplete, the error or omission is not a violation of HMDA or Regulation C provided that the institution corrects or completes the information prior to submitting the loan/application register to its regulatory agency. 12 CFR 1003.6(b)(3). April 2019 HMDA 27

HMDA
Examination Procedures
WHO MUST REPORT: HMDA INSTITUTIONAL COVERAGE
Th e precise criteria fo r whethe r a n institutio n is covere d b y Regulatio n C ar e codifie d in 12 CFR § 1003.2(g). Thes e criteria ar e illustrated b y th e followin g diagrams . Coverage criteria | Effective January 1, 2018 throug h December 31, 2019 1 Depositor y Institution Is th e institution a bank, credit union, o r savings association? Yes N o N o N o N o N o N o O n th e precedin g Decembe r 31, di d th e tota l assets o f th e institution excee d th e assetthreshold 2 ? Yes O n th e precedin g Decembe r 31, di d th e institution have a hom e o r branch office in a Metropolita n Statistical Area (MSA)? Yes In th e preceding calendar year, did th e institution originate at least on e hom e purchase loan or refinancing of a hom e purchase loan secured by a first lien o n a one- t o four-unit dwelling? Yes Is th e institution federall y insured or regulated; was th e mortgag e loan referred t o above insured, guaranteed , or supplemente d by a Federal agency ; or was th e loan intende d for sale t o Fannie Mae o r Freddie Mac? Yes Di d th e institution originate at least 3 :

25 closed-en d mortgag e loans in each of
th e tw o preceding caIendar years; or
50 0 open-en d lines of credit in each o f
th e tw o precedin g calendar years?
Yes
Nondepositor y Institution
The institution is no t covered
The institution is a depositor y financia l institutio n covered by Regulation C Is th e institution a for-profit mortgage - lendin g institution (other than a bank, No savings association, or credit union)? Yes Di d th e institution either:
Have a hom e o r branch office in an
MSA o n th e precedin g Decembe r
31, or
Receive applications for, originate, N o
or purchase at least five hom e purchase loans, hom e improvemen t loans, or refinancings related t o propert y locate d in th e same MSA or Metropolita n Division (MD) in th e precedin g calendar year? Yes Di d th e institution originat e at least 3 :
25 closed-end mortgag e loans in each
of the tw o preceding calendar years; or No
500 open-en d lines o f credi t in each
o f th e tw o precedin g calendar years?
Yes
The institution is a nondepositor y financial institution covered by Regulation C The institution is no t covere d 1 This chart is effective January 1, 2018 through December 31, 2019. On January 1, 2020 the open-end line of credit threshold will adjust to 100. 2 Every year, the Bureau announces the size of the asset threshold in the Federal Register. The asset threshold may change from year to year based on changes in the average of the Consumer Price Index for Urban Wage Earners and Clerical Workers, 3 Some transactions are not HMDA reportable and are excluded from the coverage criteria, For more information, please see § 1003.3(c) of Regulation C. This chart summarizes requirements under HMDA and Regulation C, and does not itself establish any binding obligations. It is intended only to act as a quick reference and not as a substitute for the regulation or its commentary. Always consult the regulation text and official commentary for a complete understanding of the law. Version 2.0. 9/28/2017 April 2019 HMDA 28

HMDA
Examination Procedures
HMDA TRANSACTIONAL COVERAGE
April 2019 HMDA 29
Effective January 1, 2018
Unde r HMD A an d Regulatio n C, a transactio n is reportabl e onl y if it is a n Applicatio n for, an originatio n of, o r a purchas e o f a Covere d Loan . Thes e material s illustrat e on e approac h t o hel p determin e whethe r a transactio n involve s a Covere d Loan . If th e transactio n involve s a Covere d Loan , it is reporte d onl y if th e institutio n meet s th e applicabl e loan-volum e thresholds . Term s tha t are define d in Regulatio n C ar e capitalize d in thi s documen t fo r eas e o f reference . Clic k o n th e number s belo w t o vie w th e instruction s fo r eac h step . Does the transaction involve a Covered Loan? 1 Exclude d b y its purpose ? N o 2 Secure d b y a lien o n a Dwelling ? Yes 3 Involv e a n extensio n o f credit ? Yes 4 Othe r exclusion s apply ? N o Transactio n involve s a Covere d Loa n Ye s N o N o Yes Doe s no t involv e a Covere d Loa n These materials summarize requirements under HMDA and Regulation C and do not themselves establish any binding obligations. They are intended only to act as a reference and not as a substitute for the regulation or its official commentary. Always consult the regulation text and official commentary for a complete understanding of the law. Version 2.0, 9/28/2017

1 Is the transaction excluded by its purpose?
Is th e transactio n primaril y for agricultura l purposes ?
NOTE: Agricultural-purpos e transaction s includ e transaction s tha t are secure d by a Dwellin g tha t is locate d o n real propert y tha t is use d primaril y fo r agricultura l purposes . § 1003.3(c)(9) N o Yes Is th e transactio n otherwis e mad e primaril y fo r a busines s o r commercia l purpose ? § 1003.3(c)(10) N o Yes Is th e transactio n also:

a Hom e Improvemen t Loan? § 1003.2(i),
a Hom e Purchase Loan? § 1003.2(j),
or
a Refinancing? (Including cash-out Refinancing) § 1003.2(p)
Yes N o
Procee d t o Ste p 2 Doe s no t involve a Covere d Loa n

2 Is the transaction secured by a lien on a Dwelling? 1 Is th e transactio n secure d b y a lien o n a Dwelling? 1 Yes N o Procee d t o Step 3 Doe s no t involv e a Covere d Loa n Us e th e tabl e belo w t o hel p determin e whethe r th e transactio n is secure d b y a lien o n a Dwelling . Singl e famil y structure : Multifamil y structure s Mixed-us e purpose s Dwelling

Principa l residence s
Secon d home s
Vacatio n home s
Manufacture d Home s o r
othe r factor y buil t home s
Investmen t propertie s
Individua l condominiu m Units
Detache d home s
Individua l cooperativ e unit s
Apartmen t building s
o r complexe s
Manufacture d hom e
communitie s
Condominiu m building s
o r complexe s
Cooperativ e building s
o r complexe s
Mixed-us e propert y if primar y
us e is residentia l
Propertie s fo r long-ter m
housin g an d relate d service s
(suc h as assiste d livin g fo r senio r citizen s o r supportiv e housin g fo r peopl e wit h disabilities )
Propertie s fo r long-ter m
housin g an d medica l car e if primar y us e is residentia l No t a Dwelling No t a Dwelling No t a Dwellin g
Transitor y residence s
Recreationa l vehicle s
Boat s
Camper s
Travel trailer s
Park mode l RVs
Floatin g home s
Houseboat s
Mobil e home s constructe d
befor e Jun e 15, 1976
Transitor y residence s
Hotel s
Hospital s an d propertie s
Use d t o provid e medica l car e (suc h as skille d nursing , rehabilitation , o r long-ter m medica l care )
Colleg e dormitorie s
Recreationa l vehicl e park s
Mixed-Us e propert y if primar y
us e is no t residentia l
Transitor y residence s
Structure s originall y
designe d as Dwelling s bu t use d exclusivel y fo r commercia l purpose s
Propertie s fo r long-ter m
housin g an d medica l car e if primar y us e is no t residentia l 1 Dwelling means a residential structure, whether or not attached to real property. § 1003.2(f) and comments 2(f)-1 through -5.

3 Does the transaction involve an extension of credit? 2 Credi t grante d pursuan t t o a ne w deb t obligation ? Yes N o Is o r wa s th e transaction :

a n assumption ? commen t 2(d)-2.i
o r
complete d pursuan t t o a Ne w Yor k State consolidation ,
extension , an d modificatio n agreemen t (CEMA) ? commen t 2(d)-2.i i Yes N o Procee d t o Step 4 Doe s no t involv e a Covere d Loa n 2 Generally under Regulation C, an extension of credit refers to the granting of credit only pursuant to a new debt obligation. If the transaction modifies, renews, extends, or amends the terms of an existing debt obligation, but the existing debt obligation is not satisfied and replaced, the transaction is not a new extension of credit. Unless it falls within the two exceptions noted above. § 1003.2(d) and (o), and comments 2(d)-2 end 2(o)-2

4 Do other exclusions apply? § 1003.3(c)(1) through (8) and (c)(13) Is o r was th e transaction :

originate d o r purchase d b y th e Financial Institution actin g in a fiduciar y
capacity ?
secure d by a lien o n unimprove d land?
temporar y financing ?
th e purchas e of an interes t in a poo l o f otherwis e Covere d Loans , suc h as
mortgage-participatio n certificates , mortgage-backe d securities, o r real estat e mortgag e investmen t conduits ?
th e purchas e solel y of th e right t o servic e an otherwis e Covere d Loan?
a purchas e as part o f a merge r o r acquisition, o r as par t o f th e acquisitio n
o f all o f th e assets an d liabilities o f a branc h office?
fo r a total dolla r amoun t tha t is less tha n $500 ?
a purchas e of a partial interes t in a n otherwis e Covere d Loan?
t o provid e ne w fund s in advanc e of a consolidatio n agreemen t complete d
pursuan t t o a Ne w Yor k State CEM A whe r e consolidatio n occurre d in th e sam e year as final actio n o n th e transaction ? If N O t o all of th e question s Transactio n involves a Covere d Loan If YES t o an y o f th e question s Doe s no t involve a Covere d Loa n

Transactio n involves a Covere d Loan
Regulatio n C provide s differen t loan-volum e reportin g threshold s fo r transaction s tha t involv e a Covere d Loa n dependin g o n whethe r the y involv e a Closed-En d Mortgag e Loa n o r a n Open- En d Line o f Credit , § 1003.3(c)(11) an d (12). Reportin g is require d if a threshol d is me t i n eac h o f th e tw o precedin g calenda r years. 3 (See 201 8 Institutiona l Coverag e Char t fo r guidanc e regardin g institutiona l coverage. ) Closed-End Mortgage Loan § 1003.2(d) Lendin g activit y Originate d at leas t 2 5 Closed-En d Mortgag e Loans in eac h o f th e tw o precedin g calenda r years? § 1003.3(c)(11) Yes N o Dat a reportin g Require d t o repor t al l Closed-En d Mortgag e Loa n Applications , originations , an d purchase s No t require d t o repor t Closed - En d Mortgag e Loa n Applications , originations , an d purchase s Open-End Line of Credit § 1003.2(o) Lendin g activit y Originate d at leas t 50 0 Open-En d Lines of Credit in eac h o f th e tw o precedin g calenda r years? § 1003.3(c)(12) Yes N o Dat a reportin g Require d t o repor t all Open-En d Lines o f Credi t Applications , originations , an d purchase s No t require d t o repor t Open-En d Lines o f Credi t Applications , originations , an d purchase s

Onl y originate d Covere d Loan s coun t towar d th e loan-volum e thresholds . If a threshol d is met , th e
institutio n report s all Application s fo r Covere d Loan s tha t it receives , Covere d Loan s tha t it originates , an d Covere d Loan s tha t it purchase s fo r tha t typ e o f transactio n (eithe r Closed-En d Mortgag e Loa n o r Open-En d Lin e o f Credit , o r both , if bot h threshold s ar e met).
Covere d consume r an d busines s o r commercia l purpos e origination s shoul d b e counte d togethe r whe n
assessin g th e individua l threshold s fo r Closed-En d Mortgag e Loan s an d Open-En d Line s o f Credit .
A financia l institutio n ma y voluntaril y repor t Closed-En d Mortgag e Loan s o r Open-En d Lines o f Credi t
tha t are exclude d becaus e th e financia l institutio n doe s no t mee t th e transactiona l threshol d fo r tha t typ e o f transaction . However , if i t choose s t o voluntaril y repor t Closed-En d Mortgag e Loan s o r Open-En d Lines o f Credit , th e financia l institutio n mus t repor t all suc h transaction s tha t woul d otherwis e b e covere d loan s fo r tha t calenda r year. 3 The threshold for open-end lines of credit is set at 500 for calendar years 2018 and 2019. See the Bureau's August 2017 Final Rule for more information about the temporary threshold increase for open-end lines of credit, available at consumerfinance.gov/policy-compliance/rulemaking/final-rules/regulation-c-home-mortgage-disclosure-act.

HMDA
Examination Procedures
Examination Objectives

To determine the accuracy and timeliness of the financial institution’s HMDA LAR.
To determine the financial institution’s compliance with disclosure requirements.
April 2019 HMDA 35

HMDA
Examination Procedures
Examination Procedures
Initial Procedures
A. Institutional Coverage
Determine whether an institution is subject to Regulation C because it meets the definition of financial institution. 12 CFR 1003.2(g). Depository Financial Institutions A depository financial institution is subject to Regulation C if the requirements of 12 CFR 1003.2(g)(1) are met. If the institution is a bank, savings association, or credit union, determine whether it meets the Asset-Size Threshold Test, the Location Test, the Loan Activity Test, the Federally Related Test, and the Loan-Volume Threshold Test, which are listed below. If all five tests are satisfied, then the financial institution is required to report mortgage data in accordance with Regulation C.

Asset-Size Threshold Test. Determine whether, on the preceding December 31, the
institution had assets in excess of the asset-size threshold published annually in the Federal Register, as included in the Official Interpretations, 12 CFR Part 1003, comment 2(g)-2. 12 CFR 1003.2(g)(1)(i).
Location Test. Determine whether, on the preceding December 31, the institution had a
home or branch office located in an MSA. 12 CFR 1003.2(g)(1)(ii).
Loan Activity Test. Determine whether the institution originated at least one home purchase
loan or refinancing of a home purchase loan secured by a first lien on a one-to-four-unit dwelling during the preceding calendar year. 12 CFR 1003.2(g)(1)(iii).
Federally Related Test. Determine whether the institution meets one of following criteria:
a. The institution is federally insured or federally regulated (12 CFR 1003.2(g)(1)(iv)(A)); or b. The institution originated at least one home purchase loan or refinancing of a home purchase loan that was secured by a first lien on a one-to-four-unit dwelling and also (i) was insured, guaranteed, or supplemented by a Federal agency or (ii) was intended for sale to Fannie Mae or Freddie Mac. 12 CFR 1003.2(g)(1)(iv)(B).
Loan-Volume Threshold Test. Effective January 1, 2018 and through December 31, 2019,
determine whether the institution originated at least 25 closed-end mortgage loans in each of the two preceding calendar years, or originated at least 500 open-end lines of credit in each of the two preceding calendar years. Effective January 1, 2020, determine whether the institution originated at least 25 closed-end mortgage loans in each of the two preceding April 2019 HMDA 36

HMDA
Examination Procedures calendar years, or originated at least 100 open-end lines of credit in each of the two preceding calendar years. Determine whether any transactions are appropriately excluded from coverage by Regulation C according to criteria in 12 CFR 1003.3(c)(1)–(13). The list of excluded transactions and definitions for closed-end mortgage loans and open-end lines of credit are described below in the TRANSACTIONAL COVERAGE section of these procedures. Nondepository Financial Institutions A nondepository financial institution is subject to Regulation C if the requirements of 12 CFR 1003.2(g)(2) are met. If the institution is a nondepository financial institution other than a bank, savings association, or credit union, determine whether it meets the Location Test and the LoanVolume Threshold Test described below. If both tests are satisfied, then the financial institution is required to report mortgage data in accordance with Regulation C.

Location Test. Determine whether the institution had a home or branch office in an MSA on
the preceding December 31. 12 CFR 1003.2(g)(2)(i).
Loan-Volume Threshold Test. Effective January 1, 2018 and through December 31, 2019,
determine whether the institution originated at least 25 closed-end mortgage loans in each of the two preceding calendar years, or originated at least 500 open-end lines of credit in each of the two preceding calendar years. Effective January 1, 2020, determine whether the institution originated at least 25 closed-end mortgage loans in each of the two preceding calendar years, or originated at least 100 open-end lines of credit in each of the two preceding calendar years. Determine whether any transactions are appropriately excluded from coverage by Regulation C according to criteria in 12 CFR 1003.3(c)(1)–(13). The list of excluded transactions and definitions for closed-end mortgage loans and open-end lines of credit are described below in the TRANSACTIONAL COVERAGE section. Merger or Acquisition Activity If recent merger or acquisition activity has occurred, determine whether the surviving or newly formed institution meets the definition of financial institution in 12 CFR 1003.2(g). After a merger or acquisition, the surviving or newly formed institution is a financial institution according to 12 CFR 1003.2(g) if it, considering the combined assets, location, and lending activity of the surviving or newly formed institution and the merged or acquired institutions or acquired branches, satisfies the criteria included in 12 CFR 1003.2(g). For examples of institutional coverage by Regulation C after merger or acquisition activity, please see Official Interpretations, Supplement I to 12 CFR Part 1003, comment 2(g)-3. B. Transactional Coverage Determine whether a transaction is subject to Regulation C because it:
(1) meets the definition of a covered loan as defined in 12 CFR 1003.2(e), and April 2019 HMDA 37

HMDA
Examination Procedures
(2) is not an excluded transaction as defined in 12 CFR 1003.3(c)(1)–(13). Covered Loans Institutions that meet the definition of financial institution according to 12 CFR 1003.2(g) must report data on transactions that meet the definition of a covered loan in 12 CFR 1003.2(e). Types of transactions enumerated in 12 CFR 1003.3(c)(1)–(13) are explicitly excluded from Regulation C reporting requirements.

Covered Loan. Determine whether the transaction meets the definition of covered loan
according to 12 CFR 1003.2(e) and should be reported under Regulation C. A covered loan is a closed-end mortgage loan or an open-end line of credit that is not a transaction specifically excluded from the reporting requirements of the regulation. a. Determine whether the transaction is a closed-end mortgage loan as defined in 12 CFR 1003.2(d). A closed-end mortgage loan is:
i. An extension of credit;
ii. Secured by a lien on a dwelling; and
iii. Is not an open-end line of credit, as defined by 12 CFR 1003.2(o).
b. Determine whether the transaction is an open-end line of credit as defined in 12 CFR 1003.2(o). An open-end line of credit is:
i. An extension of credit;
ii. Secured by a lien on a dwelling; and
iii. Is an open-end credit plan as defined in Regulation Z, 12 CFR 1026.2(a)(20),
but without regard to whether the credit is consumer credit, as defined in 12 CFR 1026.2(a)(12), is extended by a creditor as defined in 12 CFR 1026.2(a)(17), or is extended to a consumer as defined in 12 CFR 1026.2(a)(11).
Note: Further, a covered loan secured by five or more separate dwellings, which are not
multifamily dwellings, in more than one location is not a loan secured by a multifamily dwelling. For example, assume a landlord uses a covered loan to improve five or more dwellings, each with one individual dwelling unit, located in different parts of a town, and the loan is secured by those properties. The covered loan is not secured by a multifamily dwelling as defined by § 1003.2(n). Likewise, a covered loan secured by five or more separate dwellings that are located within a multifamily dwelling, but which is not secured by the entire multifamily dwelling (e.g., an entire apartment building or housing complex), is not secured by a multifamily dwelling as defined by § 1003.2(n). For example, assume that an investor purchases 10 individual unit condominiums in a 100-unit condominium complex using a covered loan. The covered loan would not be secured by a multifamily dwelling as defined by § 1003.2(n). Comment 2(n)-3.
Excluded Transactions. Determine whether the type of transaction is listed as an excluded
transaction in 12 CFR 1003.3(c). The following transactions are not required to be reported under Regulation C:
April 2019 HMDA 38

HMDA
Examination Procedures a. A closed-end mortgage loan or open-end line of credit originated or purchased by a financial institution acting in a fiduciary capacity (12 CFR 1003.3(c)(1)); b. A closed-end mortgage loan or open-end line of credit secured by a lien on unimproved land (12 CFR 1003.3(c)(2));
c. Temporary financing (12 CFR 1003.3(c)(3));
d. The purchase of an interest in a pool of closed-end mortgage loans or open-end lines of credit (12 CFR 1003.3(c)(4)); e. The purchase solely of the right to service closed-end mortgage loans or open-end lines of credit (12 CFR 1003.3(c)(5)); f. The purchase of closed-end mortgage loans or open-end lines of credit as part of a merger or acquisition, or as part of the acquisition of all of the assets and liabilities of a branch office as defined in 12 CFR 1003.2(c) (12 CFR 1003.3(c)(6)); g. A closed-end mortgage loan or open-end line of credit, or an application for a closedend mortgage loan or open-end line of credit, for which the total dollar amount is less than $500 (12 CFR 1003.3(c)(7)); h. The purchase of a partial interest in a closed-end mortgage loan or open-end line of credit (12 CFR 1003.3(c)(8));
i. A closed-end mortgage loan or open-end line of credit that is or will be used
primarily for agricultural purposes (12 CFR 1003.3(c)(9)); j. A closed-end mortgage loan or open-end line of credit that is or will be made primarily for a business or commercial purpose, unless the closed-end mortgage loan or open-end line of credit is a home improvement loan under 12 CFR 1003.2(i), a home purchase loan under 12 CFR 1003.2(j), or a refinancing under 12 CFR 1003.2(p) (12 CFR 1003.3(c)(10)); k. Exclusions based on a financial institution’s loan-volume:
i. An institution that originated fewer than 25 closed-end mortgage loans in
either of the two proceeding calendar years is not required to report closedend mortgage loans (12 CFR 1003.3(c)(11)).
ii. Effective January 1, 2018 and through December 31, 2019, an institution that
originated fewer than 500 open-end lines of credit in either of the two preceding calendar years, and effective January 1, 2020, an institution that originated fewer than 100 open-end lines of credit in either of the two preceding calendar years, is not required to report open-end lines of credit (12 CFR 1003.3(c)(12)).
l. A transaction that provided or, in the case of an application, proposed to provide new
funds to the applicant or borrower in advance of being consolidated in a New York State consolidation, extension, and modification agreement (as before, New York CEMA) classified as a supplemental mortgage under New York Tax Law section 255, where final action was taken on the consolidation and the new funds transaction in the same calendar year (12 CFR 1003.3(c)(13)). April 2019 HMDA 39

HMDA
Examination Procedures
Disclosure and Reporting

Determine whether the financial institution satisfies requirements related to disclosure and
reporting:
a. Reporting to agency. Determine whether the financial institution submits its HMDA LAR to the appropriate Federal agency no later than March 1 following the calendar year for which the data are compiled. 12 CFR 1003.5(a)(1)(i). b. HMDA LAR retention. Determine whether the financial institution retained a copy of its submitted annual HMDA LAR for at least three years. 12 CFR 1003.5(a)(1)(i).
c. Disclosure statement. Determine whether no later than three business days after the
financial institution receives notice from the FFIEC that the financial institution’s disclosure statement is available the financial institution makes available to the public upon request at its home office, and each branch office physically located in each MSA and each MD, a written notice that clearly conveys that the financial institution’s disclosure statement may be obtained on the Bureau’s website at www.consumerfinance.gov/hmda. 12 CFR 1003.5(b)(2). A financial institution’s disclosure statement may also be obtained from https://ffiec.cfpb.gov. d. Modified HMDA LAR. Determine whether the financial institution makes available to the public upon request at its home office, and each branch office physically located in each MSA and each MD, a written notice that clearly conveys that the financial institution’s HMDA LAR, as modified by the Bureau to protect applicant and borrower privacy, may be obtained on the Bureau’s website at www.consumerfinance.gov/hmda. 12 CFR 1003.5(c). A financial institution’s modified HMDA LAR may also be obtained from https://ffiec.cfpb.gov. e. Posted notice of availability of data. Determine whether the financial institution posts a general notice about the availability of its HMDA data in the lobby of its home office and of each branch office located in each MSA and each MD. This notice must clearly convey that the financial institution’s HMDA data is available on the Bureau’s website at www.consumerfinance.gov/hmda. 12 CFR 1003.5(e). A financial institution’s HMDA data is also available at https://ffiec.cfpb.gov. If the financial institution is a bank or savings association and has a subsidiary covered by HMDA, determine whether the subsidiary completed a separate HMDA LAR and either submitted it directly or through its parent to the appropriate Federal agency for the parent. For this purpose, a financial institution is a subsidiary of a bank or savings association if the bank or savings association holds or controls an ownership interest of greater than 50 percent in the financial institution. 12 CFR 1003.5(a)(2), comment 5(a)-6. April 2019 HMDA 40

HMDA
Examination Procedures
Transaction Testing

To conduct HMDA transaction testing, examiners select a random sample of entries from the
financial institution’s HMDA LAR (Total Sample) and ask the financial institution to provide the loan or application files (loan files) that correspond to the HMDA LAR sample entries. The size of the Total Sample will depend on the size of the financial institution’s HMDA LAR, as shown in column A of the “HMDA Transaction Testing Sample Sizes and Thresholds” table (HMDA table).
If a financial institution’s HMDA data are collected through multiple data collection and
reporting systems, examiners may test a single sample from the financial institution’s entire HMDA LAR, test separate samples from each system, or test samples from selected systems chosen based on risk. If examiners do not take a single sample from the entire HMDA LAR, they should document in their work papers from which system(s) they chose the sample(s) and why.
Once examiners receive the loan files from the financial institution, they should verify the
accuracy of the data in the entries in the HMDA LAR sample(s) against the corresponding loan files. Examiners should document in their work papers any differences between the data in the HMDA LAR and information in files, and determine whether the differences may be explained by any additional information that the financial institution may provide. Differences that are not adequately explained should be identified as errors.
All data fields within the sample may be reviewed, or the supervisory agency may prioritize
designated fields for review.
HMDA transaction testing can be divided into two stages. Both stages test for errors only in
individual data fields that are selected for review as provided above in paragraph 4. In Stage 1, examiners review only a subset of the sample (Initial Sample). The size of the Initial Sample will depend on the size of the financial institution’s HMDA LAR, as shown in column B of the HMDA table. If the number of errors identified in the Initial Sample falls below the Initial Sample Threshold in column C of the HMDA table for each and every data field reviewed, no further sample review is required and the examiners may conclude the transaction testing. If the number of errors in any data field reviewed equals or exceeds the Initial Sample Threshold in column C of the HMDA table, examiners should proceed to Stage 2 and review the remainder of the Total Sample. In Stage 2, examiners must review all data fields that had one or more errors in the Initial Sample and may review any or all Initial Sample data fields reviewed and found to have no errors in Stage 1.
If, after reviewing the remainder of the Total Sample in Stage 2, the total number of errors in
any data field equals or exceeds the Resubmission Threshold in column D of the HMDA
table, examiners should direct the financial institution to correct any such data field in its full
HMDA LAR and resubmit its HMDA LAR with the corrected data field(s).
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7. A financial institution may also be directed to correct one or more individual data fields and
resubmit its HMDA LAR, even if errors in that field or fields do not meet the Resubmission Threshold in column D of the HMDA table, if examiners have a reasonable basis to believe that errors in that field or fields will likely make analysis of the HMDA data unreliable. To illustrate, assume examiners discover that a financial institution has incorrectly coded withdrawn applications as denials to such an extent that it likely prevents reliable analysis of underwriting disparities in a fair lending examination. Examiners may direct a financial institution to correct the Action Taken data field and resubmit the HMDA LAR even if the number of Action Taken errors found in the Total Sample does not equal or exceed the Resubmission Threshold in column D of the HMDA table.
8. A financial institution may be directed to resubmit its HMDA LAR in order to include
reportable applications or loans that examiners determined were previously omitted from the HMDA LAR. Tolerances
9. For the sole purpose of determining whether the number of errors equals or exceeds the
Initial Sample Threshold in column C or the Resubmission Threshold in column D of the HMDA table, examiners should not count the following differences between data in the HMDA LAR and in the loan files as errors:

Three calendar days or less in the date the application was received or the date shown on
the application form reported pursuant to 12 CFR 1003.4(a)(1)(ii);
One thousand dollars or less in the amount of the covered loan or the amount applied for,
as applicable, reported pursuant to 12 CFR 1003.4(a)(7);
Three calendar days or less in the date of the action taken by the financial institution
reported pursuant to 12 CFR 1003.4(a)(8)(ii), provided that such differences do not result in reporting data for the wrong calendar year; and
Rounding errors in reporting the dollar amount, rounded to the nearest thousand, of the
gross annual income relied on in making the credit decision or, if a credit decision was not made, the gross annual income relied on in processing the application, reported pursuant to 12 CFR 1003.4(a)(10)(iii). To illustrate, if a loan file indicates June 4 as the application date, a HMDA LAR application date of June 1 or June 7 would not be counted as an error because it is within three calendar days of June 4, but a HMDA LAR application date of May 31 or June 8 would be counted as an error because it is more than three calendar days from June 4. Ethnicity or Race Data Errors

For purposes of these guidelines, the term “data field” generally refers to individual HMDA
Filing Instructions Guide (FIG) fields, each identified by a distinct Data Field Number and Data Field Name. With respect to information on the ethnicity or race of an applicant or April 2019 HMDA 42

HMDA
Examination Procedures borrower, or co-applicant or co-borrower, however, a data field consists of a group of FIG fields as follows:

The Ethnicity of Applicant or Borrower data field group: comprised of six FIG fields
with information on an applicant’s or borrower’s ethnicity (FIG Data Field Numbers 19- 24);
The Ethnicity of Co-Applicant or Co-Borrower data field group: comprised of six FIG
fields with information on a co-applicant’s or co-borrower’s ethnicity (FIG Data Field Numbers 25-30);
The Race of Applicant or Borrower data field group: comprised of eight FIG fields with
information on an applicant’s or borrower’s race (FIG Data Field Numbers 33-40); and
The Race of Co-Applicant or Co-Borrower data field group: comprised of eight FIG
fields with information on a co-applicant’s or co-borrower’s race (FIG Data Field Numbers 41-48).21 To illustrate, for an applicant who indicates “Hispanic or Latino” and “Mexican” in response to the question of ethnicity, a financial institution reports the information in two FIG fields, for example, Ethnicity of Applicant or Borrower: 1 (1: Hispanic or Latino) and Ethnicity of Applicant or Borrower: 2 (11: Mexican). If one or more of the six Ethnicity of Applicant or Borrower FIG fields have errors, they would count as one (and only one) error for that data field group. If the Ethnicity of Applicant or Borrower data field group has errors in the Total Sample that meet or exceed the Resubmission Threshold in column D of the HMDA table, examiners should direct the financial institution to correct the six Ethnicity of Applicant or Borrower FIG fields and resubmit its HMDA LAR with those FIG fields corrected. See example 4 on page 39.22 Prospective Changes

Examiners may direct the financial institution to make any appropriate changes in its
policies, procedures, audit processes, or other aspects of its compliance management system needed to prevent the reoccurrence of errors identified within the sample that are—absent such changes—capable of repetition, even if the number of errors does not equal or exceed either the Initial Sample Threshold in column C or the Resubmission Threshold in column D of the HMDA table, or even if the errors fall within the tolerances provided in paragraph 9. 21 Data fields indicating whether ethnicity or race information was collected on the basis of visual observation or surname (FIG Data Field Numbers 31, 32, 49, and 50) are not included in any data group enumerated in paragraph 10 and are treated as individual data fields for purposes of these guidelines. 22 Example 4 describes analogous error rates and corrective actions for the race field. April 2019 HMDA 43

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HMDA Transaction Testing Sample Sizes and Thresholds HMDA LAR Count A Total Sample Size B Initial Sample Size C Initial Sample Threshold D Resubmission Threshold

%

25–50 30* 15 2 3 10.0*
51–100 30 20 2 3 10.0
101–130 47 29 2 3 6.4
131–190 56 29 2 3 5.4
191–500 59 30 2 3 5.1
501–100,000 79 35 2 4 5.1
100,001+ 159 61 2 4 2.5
*For financial institutions with fewer than 30 HMDA LAR lines, the full sample size is the financial institution’s total number of HMDA LAR lines. The Resubmission Threshold number remains at 3. Accordingly, the Resubmission Threshold percentage will be higher for financial institutions with fewer than 30 HMDA LAR lines. Examples

Financial Institution A’s HMDA LAR contains 35 entries. Examiners select a Total Sample
of 30 loans as shown in column A of the HMDA table.

Examiners test the Initial Sample of 15 as shown in column B of the HMDA table and
find two errors in the Action Taken data field, which equals the Initial Sample Threshold in column C of the HMDA table.
Accordingly, the examiners proceed to review the remaining 15 entries in the Total
Sample and find one additional error in the Action Taken data field for a total of three errors in that field, which equals the Resubmission Threshold in column D of the HMDA
table. In the review of the remaining entries in the Total Sample, examiners also find two
errors in the Rate Spread data field, which is below the Resubmission Threshold in column D of the HMDA table.
Therefore, Financial Institution A is directed to correct the Action Taken data field and
resubmit its HMDA LAR with that field corrected.

Financial Institution B’s HMDA LAR contains 125 entries. Examiners select a Total Sample
of 47 loans as shown in column A of the HMDA table.

Examiners test the Initial Sample of 29 loans as shown in column B of the HMDA table
April 2019 HMDA 44

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Examination Procedures and find one error in the Action Taken data field, which is less than the Initial Sample Threshold in column C of the HMDA table; one error in the Loan Type data field, which is less than the Initial Sample Threshold; and no other errors.

Therefore, examiners end the HMDA transaction testing for Financial Institution B and
do not proceed to Stage 2 testing of the 18 remaining entries in the Total Sample because no Stage 1 errors in any single data field equaled or exceeded the Initial Sample Threshold.

Financial Institution C’s HMDA LAR contains 500,000 entries. Examiners select a Total
Sample of 159 loans as shown in column A of the HMDA table.

Examiners test the Initial Sample of 61 loans as shown in column B of the HMDA table
and find two errors in the Action Taken data field, which equals the Initial Sample Threshold in column C of the HMDA table; and five errors in the Loan Amount data field, which exceeds the Initial Sample Threshold in column C of the HMDA table.
Accordingly, examiners proceed to test the remaining 98 entries in the Total Sample and
find two additional errors in the Action Taken data field, for a total of four errors in that field, which equals the Resubmission Threshold in column D of the HMDA table; five additional errors in the Loan Amount data field, for a total of ten errors in that field, which exceeds the Resubmission Threshold in column D of the HMDA table; and four errors in the Census Tract data field, which equals the Resubmission Threshold in column D of the HMDA table.
Therefore, Financial Institution C is directed to correct the Action Taken data field, the
Loan Amount data field, and the Census Tract data field and resubmit its HMDA LAR with those fields corrected.

Financial Institution D’s HMDA LAR contains 1,000 entries. Examiners select a Total
Sample of 79 loans as shown in column A of the HMDA table.

Examiners test the Initial Sample of 35 loans as shown in column B of the HMDA table
and find one loan with an error in the FIG Applicant or Borrower Race: 1 field, and a different loan with an error in the FIG Applicant or Borrower Race: 2 field, for a total of two errors in the Race of Applicant or Borrower data field group, which equals the Initial Sample Threshold in column C of the HMDA table.
Accordingly, the examiners proceed to test the remaining 44 entries in the Total Sample
and find one loan with an error in the FIG Applicant or Borrower Race: 2 field, and one loan with errors in both the FIG Applicant or Borrower Race: 1 field and the FIG Applicant or Borrower Race: 2 field, for a total of four loans with at least one error in one of the eight Race of Applicant or Borrower FIG fields, which equals the Resubmission Threshold in column D of the HMDA table.
Therefore, Financial Institution D is directed to correct all eight FIG fields in the Race of
Applicant or Borrower data field group and resubmit its HMDA LAR with those FIG fields corrected.
The following table summarizes how the errors in this example are counted toward the
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Resubmission Threshold in column D of the HMDA table:
Example: Calculating Error Rates for Applicant or Borrower Race FIG Applicant or Borrower Race: 1 field FIG Applicant or Borrower Race: 2 field Race of Applicant or Borrower data field group Loan #1 Error (Initial Sample) 1 Loan #2 Error (Initial Sample) 1 Loan #3 Error (Remaining Sample) 1 Loan #4 Error (Remaining Sample) Error (Remaining Sample) 1 Total errors 4 April 2019 HMDA 46

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Federal Reserve HMDA Sampling Procedures
The following Federal Reserve sampling procedures should be applied when reviewing HMDA LAR data for accuracy:

Identify and select the HMDA LAR to be reviewed. For each HMDA reporter, review both
the current year’s data and data submitted since the most recent consumer affairs examination. The data from a single year is the universe from which the sample is taken. Examinations conducted after April 30 of each year should include a review of the current year’s data. Examinations conducted before April 30 should include a review of the current year’s data to the extent that the financial institution has already entered data for the current year on the HMDA LAR.
Determine the total number of files to be sampled, based on the size of the universe, by
referring to the Transaction Testing procedures.
Select the total random sample.
A. From an electronic download –
The most important thing to remember is that the sample must be randomly selected from the universe. A variety of tools, including a feature in Microsoft Excel, can be used to select a random sample of data electronically. The following instructions will assist you in working with Excel:
(i) Generate a random order to the universe of files from which the sample will be selected using Excel’s ‘‘Random Number Generation’’ tool by taking the following steps:
a. Select the following from the Excel menu:

Tools
Add-Ins
Analysis Tool Pak (check the box and click ‘‘OK’’)
Tools (again)
Data Analysis
Random Number Generation (highlight and click ‘‘OK’’)
b. Respond to the items on the ‘‘Random Number Generation’’ screen as follows:
Number of Variables (leave blank)
Number of Random Numbers (leave blank)
Distribution (select ‘‘Uniform’’ from list)
Parameters (leave the default as is—it is set at 0 and 1)
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Random Seed (leave blank)
Output Options (click on the ‘‘Output Range’’ circle, and then on the small box
to the right for ‘‘Output Range’’)
c. A small screen titled ‘‘Random Number Generation’’ will appear. Do not enter
any information directly on that screen. Rather, select the range (output location) for the random numbers by highlighting the column on the spreadsheet where you want the random numbers to go. (Use the ‘‘Shift’’ key and the down arrow to highlight the column.) Hint: Designating a column at the end of the spreadsheet may work best. d. Click on the small box on the ‘‘Random Number Generation’’ screen (or press ‘‘Enter’’). e. Click on ‘‘OK.’’ f. The random numbers are automatically assigned and placed into the designated column. g. Sort the files in ascending order by random number by (1) highlighting all the data, (2) selecting ‘‘Data,’’ (3) selecting ‘‘Sort,’’ (4) identifying the column (containing the random numbers) by which you will sort, (5) selecting ‘‘Ascending,’’ and (6) selecting ‘‘OK.’’ (ii) Once the loans are placed in a random order, simply take the sample needed for HMDA verification starting at the top of the list. Be sure to save this information as a supporting work paper. B. From a hard-copy HMDA LAR – (i) Divide the number of files in the ‘‘universe’’ by the desired size of the sample to determine the ‘‘interval.’’ If necessary, round down the interval to reach a whole number. (ii) Randomly pick a number between zero and the interval. (iii) Starting with the first file in the universe, count the items until reaching the number randomly picked. The file corresponding to the random number is the first file in the sample. (iv) Starting with the next file as number 1, count the files until reaching the number corresponding to the interval and select that file for the sample. (v) Repeat step (iv) throughout the universe until reaching the chosen sample size. April 2019 HMDA 48

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Designated Key HMDA Data Fields
The Board of Governors of the Federal Reserve System (Board), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) have designated HMDA key data fields to support the efficient and effective evaluation of financial institutions’ compliance with HMDA’s requirements. The Home Mortgage Disclosure Act (HMDA), which is implemented by Regulation C, 12 CFR
Part 1003, requires certain financial institutions to collect, record, and report information about
their mortgage lending activity.23 The Consumer Financial Protection Bureau’s (Bureau) amendments to Regulation C (HMDA Amendments)24 and section 104(a) of the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA)25 establish the data to be collected.26 For the purpose of ensuring compliance with HMDA’s requirements, traditionally the Board, the FDIC, and the OCC have identified and focused examination-related testing of HMDA data on certain agency-designated “key fields.” Key fields are those data fields considered to be most important to ensuring the integrity of analyses of overall HMDA data. Separately, the FFIEC members have issued FFIEC HMDA Examiner Transaction Testing Guidelines (FFIEC Guidelines) for the FFIEC members’ examination staffs to use in assessing the accuracy of the HMDA data that financial institutions collect, record, and report.27 The FFIEC Guidelines include a data sampling process that involves prioritizing designated data fields for review or reviewing all data fields within a sample. However, the FFIEC Guidelines themselves do not establish designated HMDA key data fields. In an effort to promote efficiency, coordination, and consistency, the Board, the FDIC, and the OCC have jointly identified and designated 37 of the HMDA data fields to be collected since January 1, 2018, pursuant to the HMDA Amendments, as Designated HMDA Key Data Fields. 23 12 USC 2801 et seq. 24 80 FR 66127 (October 28, 2015); 82 FR 43088 (September 13, 2017). 25 132 Stat. 1296 (2018), section 104(a) (codified at 12 USC 2803). 26 Beginning with data collected on or after January 1, 2018, financial institutions subject to HMDA collect and report data on covered loans specified in 12 CFR § 1003.4(a)(1)-(38) on a loan application register (LAR) containing 110 “data fields,” as specified in the applicable Federal Financial Institutions Examination Council (FFIEC) Filing Instructions Guide (FIG), available through the FFIEC HMDA File Specifications webpage at https://www.ffiec.gov/hmda/fileformats.htm or with other FFIEC HMDA resources at https://ffiec.cfpb.gov/. 27 The FFIEC members are the Board, the Bureau, the FDIC, the National Credit Union Administration, the OCC, and the State Liaison Committee. The FFIEC members promote compliance with federal consumer protection laws and regulations through supervisory and outreach programs. Among these laws and regulations is HMDA. April 2019 HMDA 49

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For institutions eligible for a partial exemption pursuant to EGRRCPA,28 21 of the 37 Designated HMDA Key Data Fields are among the data fields that they remain responsible for collecting, recording, and reporting. In identifying Designated HMDA Key Data Fields, the Board, the FDIC, and the OCC considered a variety of factors, including HMDA’s requirements, the goal of ensuring the efficiency of bank examinations, and the effective validation of HMDA data important to evaluating compliance with the CRA and fair lending requirements. The Board, the FDIC, and the OCC also took into account the likelihood that a data field would be reported correctly based on past examination experience. Accordingly, for the purpose of evaluating financial institutions’ compliance with HMDA requirements, the Board, the FDIC, and the OCC will focus primary attention on the Designated HMDA Key Data Fields during transaction testing for HMDA data collected on or after January 1, 2018.29 However, in certain circumstances, consistent with the FFIEC Guidelines, examination staff may determine that it is necessary to review additional HMDA data fields, as appropriate.
Table 1 lists all 110 HMDA data fields and their corresponding HMDA data points. The 37
Designated HMDA Key Data Fields applicable to financial institutions not eligible for an EGRRCPA partial exemption from HMDA’s data collection, recording, and reporting requirements are shown in italicized bold text. The 21 Designated HMDA Key Data Fields applicable to financial institutions that are eligible for an EGRRCPA partial exemption from HMDA’s data collection, recording, and reporting requirements are identified by an asterisk (*).
Table 2 solely lists the 37 Designated HMDA Key Data Fields (Column B) applicable to
financial institutions not eligible for an EGRRCPA partial exemption from HMDA’s data collection, recording, and reporting requirements and, separately, the 21 Designated HMDA Key Data Fields (Column C) applicable to financial institutions that are eligible for an EGRRCPA partial exemption from HMDA’s data collection, recording, and reporting requirements. 28 Provided that they are not subject to the exception to the partial exemptions for adverse Community Reinvestment Act (CRA) examination history, insured depository institutions eligible for a partial exemption are not required to collect, record, and report certain HMDA data points specified in EGRRCPA, as further explained in the Bureau’s interpretive and procedural rule to clarify and implement the legislation (83 FR 45325 (September 7, 2018)). Various HMDA data points are associated with multiple HMDA data fields. Financial institutions subject to a partial exemption also collect and report their HMDA data, on a LAR, as specified in the applicable FIG. Furthermore, as indicated in the Bureau’s interpretive and procedural rule, institutions eligible for a partial exemption may nevertheless opt to report HMDA data covered by that partial exemption. 29 Each agency shall operate in accordance with its supervisory authority. April 2019 HMDA 50

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Table 1

Data Field Name Data Point Name

1 Record Identifier – Value is 2
2 Legal Entity Identifier (LEI) Legal Entity Identifier (LEI) 3 Universal Loan Identifier (ULI) Universal Loan Identifier or Non-Universal Loan Identifier (NULI) (ULI) or Non-Universal Loan Identifier (NULI) 4 Application Date* Application Date* 5 Loan Type* Loan Type* 6 Loan Purpose* Loan Purpose* 7 Preapproval Preapproval 8 Construction Method Construction Method 9 Occupancy Type* Occupancy Type* 10 Loan Amount* Loan Amount* 11 Action Taken* Action Taken* 12 Action Taken Date* Action Taken Date* 13 Street Address Property Address 14 City Property Address 15 State Property Location & Property Address 16 ZIP Code Property Address 17 County Property Location 18 Census Tract* Property Location* 19 Ethnicity of Applicant or Borrower: 1* Ethnicity* 20 Ethnicity of Applicant or Borrower: 2 Ethnicity 21 Ethnicity of Applicant or Borrower: 3 Ethnicity 22 Ethnicity of Applicant or Borrower: 4 Ethnicity 23 Ethnicity of Applicant or Borrower: 5 Ethnicity 24 Ethnicity of Applicant or Borrower: Free Form Text Ethnicity Field for Other Hispanic or Latino 25 Ethnicity of Co-Applicant or Co-Borrower: 1* Ethnicity* 26 Ethnicity of Co-Applicant or Co-Borrower: 2 Ethnicity 27 Ethnicity of Co-Applicant or Co-Borrower: 3 Ethnicity 28 Ethnicity of Co-Applicant or Co-Borrower: 4 Ethnicity 29 Ethnicity of Co-Applicant or Co-Borrower: 5 Ethnicity 30 Ethnicity of Co-Applicant or Co-Borrower: Free Form Ethnicity Text Field for Other Hispanic or Latino 31 Ethnicity of Applicant or Borrower Collected on the Ethnicity Basis of Visual Observation or Surname April 2019 HMDA 51

35
40
45
50
55
HMDA
Examination Procedures

Data Field Name Data Point Name

32 Ethnicity of Co-Applicant or Co-Borrower Collected on the Basis of Visual Observation or Surname Ethnicity 33 34 36 37 38 Race of Applicant or Borrower: 1* Race of Applicant or Borrower: 2* Race of Applicant or Borrower: 3 Race of Applicant or Borrower: 4 Race of Applicant or Borrower: 5 Race of Applicant or Borrower: Free Form Text Field for American Indian or Alaska Native Enrolled or Principal Tribe Race* Race* Race 39 Race of Applicant or Borrower: Free Form Text Field for Other Asian Race Race of Applicant or Borrower: Free Form Text Field for Other Pacific Islander Race 41 42 43 44 46 Race of Co-Applicant or Co-Borrower: 1* Race of Co-Applicant or Co-Borrower: 2* Race of Co-Applicant or Co-Borrower: 3 Race of Co-Applicant or Co-Borrower: 4 Race of Co-Applicant or Co-Borrower: 5 Race of Co-Applicant or Co-Borrower: Free Form Text Field for American Indian or Alaska Native Enrolled or Race* Race* Race 47 Principal Tribe Race of Co-Applicant or Co-Borrower: Free Form Text Field for Other Asian Race 48 Race of Co-Applicant or Co-Borrower: Free Form Text Field for Other Pacific Islander Race 49 Race of Applicant or Borrower Collected on the Basis of Visual Observation or Surname Race Race of Co-Applicant or Co-Borrower Collected on the Basis of Visual Observation or Surname Race 51 52 53 Sex of Applicant or Borrower* Sex of Co-Applicant or Co-Borrower* Sex of Applicant or Borrower Collected on the Basis of Visual Observation or Surname Sex* Sex* Sex 54 Sex of Co-Applicant or Co-Borrower Collected on the Basis of Visual Observation or Surname Sex 56 57 Age of Applicant or Borrower* Age of Co-Applicant or Co-Borrower* Income* Age* Age* Income* April 2019 HMDA 52

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Data Field Name Data Point Name

58 Type of Purchaser Type of Purchaser
59 Rate Spread Rate Spread
60 HOEPA Status HOEPA Status
61 Lien Status* Lien Status*
62 Credit Score of Applicant or Borrower Credit Score 63 Credit Score of Co-Applicant or Co-Borrower Credit Score 64 Applicant or Borrower, Name and Version of Credit Credit Score Scoring Model 65 Applicant or Borrower, Name and Version of Credit Credit Score Scoring Model: Conditional Free Form Text Field For Code 8 66 Co-Applicant or Co-Borrower, Name and Version of Credit Score Credit Scoring Model 67 Co-Applicant or Co-Borrower, Name and Version of Credit Score Credit Scoring Model: Conditional Free Form Text Field For Code 8 68 Reason for Denial: 1 Reason for Denial 69 Reason for Denial: 2 Reason for Denial 70 Reason for Denial: 3 Reason for Denial 71 Reason for Denial: 4 Reason for Denial 72 Reason for Denial: Conditional Free Form Text Field for Reason for Denial Code 9 73 Total Loan Costs Total Loan Costs or Total Points and Fees 74 Total Points and Fees Total Loan Costs or Total Points and Fees 75 Origination Charges Origination Charges 76 Discount Points Discount Points 77 Lender Credits Lender Credits 78 Interest Rate Interest Rate 79 Prepayment Penalty Term Prepayment Penalty Term 80 Debt-to-Income Ratio Debt-to-Income Ratio 81 Combined Loan-To-Value Ratio Combined Loan-To-Value Ratio 82 Loan Term Loan Term 83 Introductory Rate Period Introductory Rate Period 84 Balloon Payment Non-Amortizing Features 85 Interest-Only Payments Non-Amortizing Features 86 Negative Amortization Non-Amortizing Features 87 Other Non-Amortizing Features Non-Amortizing Features April 2019 HMDA 53

Data Field Name Data Point Name

88 Property Value Property Value
89 Manufactured Home Secured Property Type Manufactured Home Secured Property Type 90 Manufactured Home Land Property Interest Manufactured Home Land Property Interest 91 Total Units* Total Units* 92 Multifamily Affordable Units Multifamily Affordable Units 93 Submission of Application Application Channel 94 Initially Payable to Your Institution Application Channel 95 Mortgage Loan Originator NMLSR Identifier Mortgage Loan Originator NMLSR Identifier 96 Automated Underwriting System: 1 Automated Underwriting System 97 Automated Underwriting System: 2 Automated Underwriting System 98 Automated Underwriting System: 3 Automated Underwriting System 99 Automated Underwriting System: 4 Automated Underwriting System 100 Automated Underwriting System: 5 Automated Underwriting System 101 Automated Underwriting System: Conditional Free Form Automated Underwriting Text Field for Code 5 System 102 Automated Underwriting System Result: 1 Automated Underwriting System 103 Automated Underwriting System Result: 2 Automated Underwriting System 104 Automated Underwriting System Result: 3 Automated Underwriting System 105 Automated Underwriting System Result: 4 Automated Underwriting System 106 Automated Underwriting System Result: 5 Automated Underwriting System 107 Automated Underwriting System Result: Conditional Automated Underwriting Free Form Text Field for Code 16 System 108 Reverse Mortgage Reverse Mortgage 109 Open-End Line of Credit Open-End Line of Credit 110 Business or Commercial Purpose Business or Commercial Purpose HMDA Examination Procedures April 2019 HMDA 54

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Table 2
A

B
Designated Key HMDA Data Fields for financial institutions not eligible for an EGRRCPA partial exemption from HMDA data collection, recording, and reporting requirements C Designated Key HMDA Data Fields for financial institutions that are eligible for an EGRRCPA partial exemption from HMDA data collection, recording, and reporting requirements 3 Universal Loan Identifier (ULI) 4 Application Date Application Date 5 Loan Type Loan Type 6 Loan Purpose Loan Purpose 9 Occupancy Type Occupancy Type 10 Loan Amount Loan Amount 11 Action Taken Action Taken 12 Action Taken Date Action Taken Date 18 Census Tract Census Tract 19 Ethnicity of Applicant or Borrower: 1 Ethnicity of Applicant or Borrower: 1 25 Ethnicity of Co-Applicant or Co-Borrower: 1 Ethnicity of Co-Applicant or Co-Borrower: 1 33 Race of Applicant or Borrower: 1 Race of Applicant or Borrower: 1 34 Race of Applicant or Borrower: 2 Race of Applicant or Borrower: 2 41 Race of Co-Applicant or Co-Borrower: 1 Race of Co-Applicant or Co-Borrower: 1 42 Race of Co-Applicant or Co-Borrower: 2 Race of Co-Applicant or Co-Borrower: 2 51 Sex of Applicant or Borrower Sex of Applicant or Borrower 52 Sex of Co-Applicant or Co-Borrower Sex of Co-Applicant or Co-Borrower 55 Age of Applicant or Borrower Age of Applicant or Borrower 56 Age of Co-Applicant or Co-Borrower Age of Co-Applicant or Co-Borrower 57 Income Income 61 Lien Status Lien Status 62 Credit Score of Applicant or Borrower 63 Credit Score of Co-Applicant or Co-Borrower 75 Origination Charges 76 Discount Points 77 Lender Credits 78 Interest Rate 80 Debt-to-Income Ratio 81 Combined Loan-To-Value Ratio 82 Loan Term 88 Property Value 89 Manufactured Home Secured Property Type 91 Total Units Total Units 102 Automated Underwriting System Result: 1 108 Reverse Mortgage 109 Open-End Line of Credit 110 Business or Commercial Purpose April 2019 HMDA 55

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Federal Reserve Transaction Testing for Omissions Examiners should perform HMDA transaction testing for omissions on a risk-focused basis, taking into account the financial institution’s HMDA compliance record, its volume of HMDAreportable applications and loans, and the types of HMDA-reportable loans that it offers and/or purchases. Omissions can include both HMDA-reportable originated loans, HMDA-reportable nonoriginated loans (e.g., applications closed for incompleteness, applications that were approved but not accepted, withdrawn applications, declined applications), and HMDA-reportable purchased loans that a financial institution fails to include on a HMDA LAR. Examiners may choose, on a risk-focused basis, to focus an omissions review upon a specific loan origination channel, data collection and reporting system (e.g., loans sold), or type of loan (e.g., home equity lines of credit). To identify omitted HMDA-reportable originated loans, non-originated loans, and/or purchased loans:
10. Examiners select a random sample of the financial institution’s originated, non-originated, or
purchased loans or a combination thereof (Total Sample). The size of the Total Sample will depend on the volume of the financial institution’s HMDA-reportable applications and/or loans, as shown in column A of the following “HMDA Omissions Transaction Testing Sample Sizes and Thresholds” table. HMDA Omissions Transaction Testing Sample Sizes and Thresholds HMDA-Reportable Applications/Loans Count A Total Sample Size B Initial Sample Size C Initial Sample Threshold D Resubmission Threshold

%

25–50 30 15 2 3 10.0
51–100 30 20 2 3 10.0
101–130 47 29 2 3 6.4
131–190 56 29 2 3 5.4
191–500 59 30 2 3 5.1
501–100,000 79 35 2 4 5.1
100,001+ 159 61 2 4 2.5
11. Examiners should verify the completeness of the entries in the financial institution’s HMDA
LAR against the random sample of originated, non-originated, and/or purchased loans. April 2019 HMDA 56

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Examiners should document in their work papers any apparent omissions in the HMDA LAR when compared with the random sample, and determine whether the differences may be explained by any additional information that the financial institution may provide. Differences that are not adequately explained should be identified as omissions.
12. HMDA transaction testing for omissions can be divided into two stages. In Stage 1,
examiners review only a subset of the sample (Initial Sample). The size of the Initial Sample will depend on the volume of the financial institution’s HMDA-reportable applications and/or loans, as shown in column B of the HMDA table. If the number of omissions identified in the Initial Sample falls below the Initial Sample Threshold in column C of the HMDA table, no further sample review is required and the examiners may conclude the transaction testing. If the number of omissions equals or exceeds the Initial Sample Threshold in column C of the HMDA table, examiners should proceed to Stage 2 and review the remainder of the Total Sample.
13. If, after reviewing the remainder of the Total Sample in Stage 2, the total number of
omissions equals or exceeds the Resubmission Threshold in column D of the HMDA table, examiners should direct the financial institution to include the omissions in its full HMDA LAR and submit a corrected HMDA LAR. Additionally, the root cause of the omissions should be assessed to determine the likely full scope of the errors (i.e., incidence in certain loan channels, data collection and reporting systems, or loan types). April 2019 HMDA 57

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Review of Compliance Management System
Examiners should determine if the financial institution’s HMDA compliance management system (CMS) is adequate. An adequate HMDA CMS is comprehensive and commensurate with the institution’s residential mortgage lending activity and size, structure, complexity, and risk profile. Portions of the review may be conducted during either the offsite or the onsite portion of the examination. Examiners should obtain information necessary to determine whether the institution’s policies, procedures, and practices ensure appropriate collection, recording, and reporting of data on applications for covered loans that it receives, covered loans that it originates, and covered loans that it purchases pursuant to HMDA and Regulation C requirements. Examiners should also determine whether the financial institution’s policies, procedures, and practices ensure compliance with HMDA and Regulation C’s disclosure requirements. Examiners should conduct this assessment through a review of HMDA LARs, written policies and procedures, internal controls, and training materials, as well as discussions with management. Evaluation of Compliance Management During the review of the financial institution’s system for ensuring compliance with HMDA and Regulation C, obtain and review copies of policies, procedures, and any applicable audit and compliance management program materials to determine whether:

The institution annually, or more frequently if appropriate, conducts analysis to
determine if it must collect, record, and report data regarding dwelling-secured applications and loans (covered transactions) pursuant to HMDA and Regulation C.
The institution conducts analysis to ensure that all reportable applications and loans are
collected and recorded on the HMDA LAR.
The institution has assigned one or more individuals responsibility for the oversight of
HMDA compliance, including HMDA data collection, recording, and reporting. Also, determine whether individuals responsible for HMDA compliance receive access to and appropriate training on HMDA, Regulation C and its commentary, all applicable regulatory and statutory changes, the Filing Instructions Guide, the A Guide to HMDA Reporting: Getting It Right!, and any other relevant materials.
The board of directors and senior management possess sufficient knowledge to ensure
oversight of compliance with HMDA and Regulation C. Also, determine whether the board of directors and senior management provide appropriate resources and oversight regarding ensuring the institution’s compliance with HMDA and Regulation C. April 2019 HMDA 58

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5. Internal review procedures, monitoring, and audit schedules comprehensively cover all
pertinent HMDA and Regulation C requirements, including all applicable statutory and regulatory changes since prior compliance reviews and/or audits.
6. Compliance reviews and audits performed include a sufficient level of transactional
analysis as well as written reports that detail findings and recommendations for corrective action. Also, determine whether the board of directors and senior management are informed of these findings and recommendations.
7. The institution adequately monitors vendors and other third-party service providers that
perform functions or deliver services related to HMDA data collection, recording, and reporting.
8. The institution takes effective corrective action in response to identified HMDA
deficiencies.
Evaluation of Policies, Procedures, and Internal Controls Evaluate whether the financial institution’s policies, procedures, and internal controls are adequate to ensure compliance with HMDA and Regulation C. Consider the following:

Whether the individuals responsible for ensuring HMDA compliance possess an adequate
level of knowledge regarding HMDA and Regulation C, including all applicable statutory and regulatory changes.
Whether the institution ensures that individuals assigned responsibility for the
institution’s HMDA compliance receive adequate training to ensure compliance with HMDA and Regulation C.
Whether the individuals responsible for ensuring HMDA compliance know who to
contact (e.g., legal counsel, supervisory agency) if they have interpretive or technical questions.
Whether the institution has developed appropriate policies and procedures, and revises
those policies and procedures as necessary, to ensure HMDA compliance.
Whether HMDA data are collected at all branches, and, if so, whether relevant branch
personnel are appropriately trained on HMDA data collection, recording, and reporting requirements. Also, whether the institution’s loan officers in the commercial loan department, who may handle HMDA-reportable applications, are informed of collection, recording, and reporting requirements.
Whether the institution’s policies and procedures ensure continuing HMDA compliance
during and after major changes in the institution’s business or structure. April 2019 HMDA 59

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7. Based on the volume of HMDA-reportable applications and loans and the complexity of
the processes used to gather the data, whether the board of directors and senior management review policies and procedures and audit and compliance reports regarding the institution’s HMDA data reporting. April 2019 HMDA 60

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Examination Conclusions and Wrap-Up
To conclude this supervisory activity, examiners must:

Summarize findings, including errors, omissions, and supervisory concerns.
For any errors, omissions, or other concerns noted, determine the root cause by
identifying weaknesses in oversight, policies and procedures, training, monitoring, audit, or other CMS considerations. Determine whether any errors, omissions, or concerns are capable of repetition or otherwise reflect systemic issues.
Identify corrective actions needed to remediate HMDA violations and CMS deficiencies,
as appropriate.
Include corrective actions within the supervisory letter or examination report.
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Examination Checklist
Applicability
Depository Institutions

Is the depository institution a bank, a savings association, or a credit union?
(§1003.2(g)(1))
Did the depository institution:
a. On December 31 of the preceding calendar year, have assets in excess of the threshold that is adjusted annually and published annually by the Consumer Financial Protection Bureau (Bureau) for coverage by HMDA? (§1003.2(g)(1)(i)) b. On December 31 of the preceding calendar year, have a home or branch office in an MSA? §1003.2(g)(1)(ii)) and
c. In the preceding calendar year, originate at least one home purchase loan or
refinancing of a home purchase loan, secured by a first lien on a one- to four-unit dwelling? (§1003.2(g)(1)(iii)).
Does the depository institution meet one or more of the following criteria?
(§1003.3(g)(1)(iv)) a. The depository institution is federally insured or regulated; (§1003.2(g)(1)(iv)(A)) b. The depository institution originated at least one mortgage loan (reference checklist question #2.c) that was insured, guaranteed, or supplemented by a Federal agency or was intended by the institution for sale to the Federal National Mortgage Association (Fannie Mae) or the Federal Home Loan Mortgage Corporation (Freddie Mac). (§1003.2(g)(1)(iv)(B))
Does the depository institution meet one or more of the following criteria?
(§1003.2(g)(1)(v)) a. In each of the two preceding calendar years, the depository institution originated 25 or more closed-end mortgage loans that are not excluded from consideration pursuant to §1003.3(c)(1) through (10) or (13); (§1003.2(g)(1)(v)(A)) b. In each of the two preceding calendar years, the depository institution originated 100 or more open-end lines of credit (500 or more open-end lines of credit in calendar years 2018 and 2019) that are not excluded from consideration pursuant to §1003.3(c)(1) through (10). (§1003.2(g)(1)(v)(B)) If the answers to checklist questions #1 through #4 are "Yes," then the depository institution is subject to the requirements of HMDA and Regulation C and the examiner should complete the remaining portion of the checklist. April 2019 HMDA 62

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Non-Depository Institutions
5. Is the non-depository institution a for-profit mortgage-lending institution (other than a
bank, savings association, or credit union)? (§1003.2(g)(2))
6. Did the non-depository institution, on December 31 of the preceding calendar year, have
a home or branch office in an MSA? ((§1003.2(g)(2)(i))
7. Does the non-depository institution meet one or more of the following criteria?
((§1003.2(g)(2)(ii)) a. In each of the two preceding calendar years, the non-depository institution originated 25 or more closed-end mortgage loans that are not excluded from consideration pursuant to §1003.3(c)(1) through (10); (§1003.2(g)(2)(ii)(A)) b. In each of the two preceding calendar years, the non-depository institution originated 100 or more open-end lines of credit (500 or more open-end lines of credit in calendar years 2018 and 2019) that are not excluded from consideration pursuant to §1003.3(c)(1) through (10) and (13). (§1003.2(g)(2)(ii)(B)) If the answers to checklist questions #5 through #7 are "Yes," then the non-depository institution is subject to the requirements of HMDA and Regulation C and the examiner should complete the remaining portion of the checklist. Compilation of Loan Data
8. If not eligible for a partial exemption from HMDA’s data collection recording, and
reporting requirements for certain transactions pursuant to section 104(a) of the Economic Growth, Regulatory Relief, and Consumer Protection Act, does the financial institution collect the following data in accordance with §1003.4(a) regarding applications for covered loans that it receives, covered loans that it originates, and covered loans that it purchases for each calendar year? (§1003.4(a)) a. A universal loan identifier for the covered loan or application that can be used to identify and retrieve the covered loan or application file; (§1003.4(a)(1)(i)) b. Except for purchased covered loans, the date the application was received or the date shown on the application form; (§1003.4(a)(1)(ii))
c. Whether the covered loan is, or in the case of an application would have been,
insured by the Federal Housing Administration or guaranteed by the Veterans Administration, the Rural Housing Service, or the Farm Service Agency; (§1003.4(a)(2)) d. Whether the covered loan is, or the application is for, a home purchase loan, a home improvement loan, a refinancing, a cash-out refinancing, or for a purpose other April 2019 HMDA 63

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Examination Procedures than home purchase, home improvement, refinancing, or cash-out refinancing; (§1003.4(a)(3)) e. Whether the application or covered loan involved a request for a preapproval of a home purchase loan under a preapproval program; (§1003.4(a)(4)) f. Whether the dwelling is site-built or a manufactured home; (§1003.4(a)(5)) g. Whether the property will be used as a principal residence, a second residence, or an investment property; (§1003.4(a)(6)) h. The amount of the covered loan or the amount applied for, as applicable; (§1003.4(a)(7))
i. The type and date of the action the financial institution took on the loan, the
application, or the preapproval request; (§1003.4(a)(8)) j. The address of the property securing the loan (or proposed to secure a loan); (§1003.4(a)(9)(i)) k. If the property is located in an MSA or an MD in which the financial institution has a home or branch office, or if the institution is required to report data on small business, small farm, or community development lending under the Community Reinvestment Act (CRA), the location of the property securing the loan (or proposed to secure a loan) by state, country, and census tract; (§1003.4(a)(9)(ii))
l. The applicant’s or borrower’s ethnicity, race, and sex, and if the information was
collected by visual observation or surname; (§1003.4(a)(10)(i)) m. The applicant’s or borrower’s age; (§1003.4(a)(10)(ii)) n. Except for covered loans or applications for which the credit decision did not consider or would not have considered income, the gross annual income relied on in making the credit decision or, if a credit decision was not made, the gross annual income relied on in processing the application; (§1003.4(a)(10)(iii)) o. The type of entity purchasing a covered loan that the financial institution originates or purchases and then sells within the same calendar year; (§1003.4(a)(11)) p. The difference between the annual percentage rate and the average prime offer rate for a comparable transaction; (§1003.4(a)(12)) q. Whether the loan is a high-cost mortgage under the Home Ownership and Equity Protection Act; (§1003.4(a)(13)) April 2019 HMDA 64

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Examination Procedures r. Whether the property is a first or a subordinate lien; (§1003.4(a)(14)) s. The credit score(s) relied on and the name and version of the credit scoring model; (§1003.4(a)(15)) t. The principal reason(s) the financial institution denied the application, if applicable; (§1003.4(a)(16)) u. Either the total loan costs or total points and fees charged, if applicable; (§1003.4(a)(17))
v. The total borrower-paid origination charges, if applicable; (§1003.4(a)(18))
w. The points paid to the creditor to reduce the interest rate, if applicable; (§1003.4(a)(19))
x. The amount of lender credits, if applicable; (§1003.4(a)(20))
y. The interest rate applicable to the approved application or to the covered loan at closing or account opening; (§1003.4(a)(21)) z. The term in months of any prepayment penalty, if applicable; (§1003.4(a)(22)) aa. Except for purchased covered loans, the ratio of the applicant’s or the borrower’s total monthly debit to the total monthly income relied on in making the credit decision; (§1003.4(a)(23)) bb. Except for purchased covered loans, the ratio of the total amount of debt secured by the property to the value of the property relied on in making the credit decision; (§1003.4(a)(24))
cc. The scheduled number of months after which the legal obligation will mature or
terminate or would have matured or terminated; (§1003.4(a)(25)) dd. The number of months, or proposed number of months in the case of an application, until the first date that the interest rate may change; (§1003.4(a)(26)) ee. Whether the transaction involves a balloon payment, interest-only payments, negative amortization, or any other type of non-amortizing feature; (§1003.4(a)(27)) ff. The value of the property securing the loan or, in the case of an application, proposed to secure the covered loan relied on in making the credit decision; (§1003.4(a)(28)) April 2019 HMDA 65

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Examination Procedures gg. If the dwelling related to the property is a manufactured home and not a multifamily dwelling, whether the covered loan is secured by a manufactured home and land or a manufactured home and not land; (§1003.4(a)(29)) hh. If the dwelling related to the property is a manufactured home and not a multifamily dwelling, information about the applicant’s or borrower’s ownership or leasehold interest in the land where the manufactured home is located; (§1003.4(a)(30))
ii. The number of individual dwelling units related to the property securing the
covered loan or, in the case of an application, proposed to secure the covered loan; (§1003.4(a)(31)) jj. The number of individual dwelling units related to the property that are incomerestricted under federal, state, or local affordable housing programs; (§1003.4(a)(32)) kk. Except for purchased covered loans, indicators regarding whether the application was submitted directly to the financial institution and whether the obligation was initially payable to the financial institution; (§1003.4(a)(33))
ll. The Nationwide Mortgage Licensing System & Registry unique identifier for the
mortgage loan originator; (§1003.4(a)(34)) mm. Except for purchased covered loans, the name of the automated underwriting system used by the financial institution to evaluate the application and the result generated by the system; (§1003.4(a)(35)) nn. Whether the covered loan is, or the application is for, a reverse mortgage; (§1003.4(a)(36)) oo. Whether the covered loan is, or the application is for, an open-end line of credit; (§1003.4(a)(37)) pp. Whether the covered loan is, or the application is for a covered loan that will be, made primarily for a business or commercial purpose. (§1003.4(a)(38))
9. If eligible for a partial exemption from HMDA’s data collection recording, and reporting
requirements for certain transactions pursuant to section 104(a) of the Economic Growth, Regulatory Relief, and Consumer Protection Act, does the financial institution collect the following data in accordance with §1003.4(a) regarding applications for covered loans that it receives, covered loans that it originates, and covered loans that it purchases for each calendar year? (§1003.4(a)) a. Except for purchased covered loans, the date the application was received or the date shown on the application form; (§1003.4(a)(1)(ii)) April 2019 HMDA 66

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Examination Procedures b. Whether the covered loan is, or in the case of an application would have been, insured by the Federal Housing Administration or guaranteed by the Veterans Administration, the Rural Housing Service, or the Farm Service Agency; (§1003.4(a)(2))
c. Whether the covered loan is, or the application is for, a home purchase loan, a
home improvement loan, a refinancing, a cash-out refinancing, or for a purpose other than home purchase, home improvement, refinancing, or cash-out refinancing; (§1003.4(a)(3)) d. Whether the application or covered loan involved a request for a preapproval of a home purchase loan under a preapproval program; (§1003.4(a)(4)) e. Whether the dwelling is site-built or a manufactured home; (§1003.4(a)(5)) f. Whether the property will be used as a principal residence, a second residence, or an investment property; (§1003.4(a)(6)) g. The amount of the covered loan or the amount applied for, as applicable; (§1003.4(a)(7)) h. The type and date of the action the financial institution took on the loan, the application, or the preapproval request; (§1003.4(a)(8))
i. If the property is located in an MSA or an MD in which the financial institution
has a home or branch office, or if the institution is required to report data on small business, small farm, or community development lending under the Community Reinvestment Act (CRA), the location of the property securing the loan (or proposed to secure a loan) by state, country, and census tract; (§1003.4(a)(9)(ii)) j. The applicant’s or borrower’s ethnicity, race, and sex, and if the information was collected by visual observation or surname; (§1003.4(a)(10)(i)) k. The applicant’s or borrower’s age; (§1003.4(a)(10)(ii))
l. Except for covered loans or applications for which the credit decision did not
consider or would not have considered income, the gross annual income relied on in making the credit decision or, if a credit decision was not made, the gross annual income relied on in processing the application; (§1003.4(a)(10)(iii)) m. The type of entity purchasing a covered loan that the financial institution originates or purchases and then sells within the same calendar year; (§1003.4(a)(11)) April 2019 HMDA 67

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Examination Procedures n. Whether the loan is a high-cost mortgage under the Home Ownership and Equity Protection Act; (§1003.4(a)(13)) o. Whether the property is a first or a subordinate lien; (§1003.4(a)(14)) p. The number of individual dwelling units related to the property securing the covered loan or, in the case of an application, proposed to secure the covered loan; (§1003.4(a)(31))
10. Does the financial institution collect data about the ethnicity, race, and sex of the
applicant or borrower as prescribed in Appendix B to the regulation? (§1003.4(b)(1))
11. If the financial institution is required to report data on small business, small farm, and
community development lending under the CRA, does it also collect property address and property location information for property located outside MSAs and MDs in which the institution has a home or branch office or outside of any MSA? (§1003.4(e))
12. Does the financial institution record the data collected on a HMDA LAR within 30
calendar days after the end of the calendar quarter in which final action (such as origination or purchase of a covered loan, sale of a covered loan in the same calendar year it is originated or purchased, or denial or withdrawal of an application) is taken? (§1003.4(f)) Disclosure and Reporting
13. Is the financial institution’s data presented in the required format on its HMDA LAR?
14. Has the financial institution reported all applications for covered loans that it receives,
covered loans that it originates, and covered loans that it purchases as required by the regulation?
15. Has the financial institution excluded from reporting the following types of transactions
that are not reportable under the regulation: (§1003.3(c)) a. A closed-end mortgage loan or open-end line of credit originated or purchased by a financial institution acting in a fiduciary capacity; b. A closed-end mortgage loan or open-end line of credit secured by a lien on unimproved land;
c. Temporary financing;
d. The purchase of an interest in a pool of closed-end mortgage loans or open-end lines of credit; e. The purchase solely of the right to service closed-end mortgage loans or open-end lines of credit; f. The purchase of closed-end mortgage loans or open-end lines of credit as part of a merger or acquisition, or as part of the acquisition of all of the assets and liabilities of a branch office as defined in §1003.2(c); April 2019 HMDA 68

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Examination Procedures g. A closed-end mortgage loan or open-end line of credit, or an application of a closed-end mortgage loan or open-end line of credit, for which the total dollar amount is less than $500; h. The purchase of a partial interest in a closed-end mortgage loan or open-end line of credit;
i. A closed-end mortgage loan or open-end line of credit used primarily for
agricultural purposes; j. A closed-end mortgage loan or open-end line of credit that is or will be made primarily for a business or commercial purpose, unless the closed-end mortgage loan or open-end equity line of credit is a home improvement loan under §1003.2(i), a home purchase under §1003.2(j), or a refinancing under §1003.2(p); k. A closed-end mortgage loan, if the financial institution originated fewer than 25 closed-end mortgage loans in each of the two preceding calendar years; and
l. An open-end equity line of credit, if the institution originated fewer than 100
open-end equity lines of credit in each of the two preceding calendar years (fewer than 500 open-end lines of credit in calendar years 2018 and 2019). m. A transaction that provided or, in the case of an application, proposed to provide new funds to the applicant or borrower in advance of being consolidated in a New York State consolidation, extension, and modification agreement classified as a supplemental mortgage under New York Tax Law section 255 (the transaction is excluded only if final action on the consolidation was taken in the same calendar year as final action on the new funds transaction).
16. Has the financial institution submitted to the appropriate supervisory agency its
completed HMDA LAR, in the required format, no later than March 1 following the calendar year for which the data are compiled? (§1003.5(a))
17. Effective January 1, 2020, within 60 days of the end of each calendar quarter (apart from
the fourth quarter), has a financial institution with at least 60,000 covered loans and applications combined, excluding purchased covered loans, submitted to the appropriate supervisory agency its HMDA LAR containing all required data in the required format? (§1003.5(a))
18. Has a financial institution that is a subsidiary of a bank or savings association completed
a separate HMDA LAR and submitted it, directly or through its parents, to the same supervisory agency as its parent? (§1003.5(a))
19. Has an authorized representative of the financial institution with knowledge of the data
certified as to the accuracy and completeness of the data submitted? (§1003.5(a))
20. Does the financial institution retain a copy of each submitted HMDA LAR for its records
for at least three years? (§1003.5(a))
21. Effective January 1, 2019, does the financial institution provide with its HMDA LAR
submission: its name; its calendar year or calendar year and quarter its submission covers; its April 2019 HMDA 69

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Examination Procedures name and contact information for a person who may be contacted about the submission; its appropriate federal agency; the total number of entries contained in the submission; its federal taxpayer identification number; and its Legal Entity Identifier? (§1003.5(a))
22. Does the financial institution, no later than three business days after receiving notice from
the Federal Financial Institutions Examination Council that its disclosure statement is available, make available to the public upon request at is home office, and each branch office physically located in each MSA and each MD, a written notice that clearly conveys that its disclosure statement may be obtained on the Bureau’s website? (§1003.5(b))
23. Does the financial institution, following the calendar year for which the data are
collected, make available to the public upon request at its home office, and each branch office physically located in each MSA and each MD, a written notice that clearly conveys that its modified HMDA LAR may be obtained on the Bureau’s website? (§1003.5(c))
24. Does the financial institution, during normal business hours, make the written notice
regarding availability of its modified HMDA LAR available to the public for three years and the written notice regarding availability of its disclosure statement available to public for five years? (§1003.5(d))
25. Does the financial institution 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 that clearly conveys that the data is available on the Bureau’s website? (§1003.5(e)) Evaluate Compliance Management System
26. Does the financial institution have adequate board of directors and senior management
oversight for HMDA compliance?
27. Does the financial institution have adequate policies, procedures, and practices for
ensuring and monitoring HMDA compliance?
28. Does the financial institution provide adequate training for staff with HMDA compliance
responsibilities?
29. Does the financial institution conduct adequate monitoring for HMDA compliance?
30. Does the financial institution implement adequate corrective action for identified HMDA
compliance risks or violations?
31. Does the financial institution conduct adequate HMDA compliance reviews or audits?
32. Was the financial institution required to resubmit any HMDA data?
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33. Did the financial institution commit to the corrective actions presented during the
examination wrap-up?
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References
12 CFR Part 1003
Official Interpretations, Supplement I to 12 CFR Part 1003 April 2019 HMDA 72

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Attachment A
Reportable HMDA Data: A Regulatory and Reporting Overview Reference Chart:
https://s3.amazonaws.com/files.consumerfinance.gov/f/documents/cfpb_reportable-hmdadata_regulatory-and-reporting-overview-reference-chart-2019.pdf April 2019 HMDA 73

Federal Reserve HMDA Examination Procedures

%

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Lineage: No known changes