Which of the following institutions is NOT subject to the coverage of HMDA?

·         Bank A, with assets of $55 million and located in a large urban city, makes home improvement loans and some home purchase loans to existing customers, but no mortgage loans.

·         Bank B, with assets of $20 million and located in a rural area, has several branches, also in rural areas, including one that makes home improvement and home purchase loans.

·         Mortgage Company C, with assets of $75 million and a home office in a large East Cost city, makes exclusively home purchase loans.

A. All institutions are subject to HMDA

B. Bank A

C. Bank B

D. Mortgage Company C

C. Bank B

Reg. C: 12 CFR 1003.2 and Staff Commentary

Banks must have assets of greater than $41 million in the preceding calendar year, have an office or branch in a metropolitan area (MA), and make at least one home purchase loan secured by a lien on the dwelling.  Mortgage companies must have assets of $10 million in the preceding calendar year, have an office in an MA, and have at least 10% of their loan volume I home purchase loans or have originated HMDA-covered loans of at least $25 million.  Therefore, Bank B’s asset size exempts them from HMDA coverage.

Several types of loan-related data appear in the following list.  Which type of data is NOT required to be reported under HMDA?

A. Data on multifamily housing

B. Data on unsecured home improvement loans

C. Data on refinancing of home purchase loans

D. Data on loans to purchase residential lots

D. Data on loans to purchase residential lots

Reg. C: 12 CFR 1003.4(d)(2)

Loans on unimproved land are not covered by regulation.  Unsecured home improvement loans may be reported if the institution classifies them as home improvement loans.  If they are not classified as home improvement loans, they do not have to be reported.

Of the following types of data, which one is NOT required to be reported for each application for an originated loan subject to Regulation C?

A. Purpose of the loan

B. Race, ethnicity, and sex of the applicant

C. Type of action taken and the date

D. The interest rate on the loan

D. The interest rate on the loan

Reg. C: 12 CFR 1003.4

Lenders do not have to report the interest rate on HMDA-reportable loans.  The rate spread is required to be reported, not the rate itself.

The following statements make assertions about the collection and reporting of data on race, ethnicity, sex, and income.  Which statement is false?

A. It must be requested on all HMDA-reportable applications received in person from natural persons.

B. It must be requested only for the loans where the application is taken in person.

C. It must be reported unless the loan was purchased.

D. It must be requested verbally on telephone applications.

B. It must be requested only for the loans where the application is taken in person.

Reg. C: 12 CFR 1003.4, Appendix A to part 1003

The info on ethnicity, race, and sex must be requested on all HMDA-related applications, even those received by telephone, by mail, or from the Internet.  It does not have to reported if the borrower fails to supply the info in an application that is not taken in a face-to-face interview.  The institution does not have to report this info on purchased loans.

On which of these loans does First National have to report the interest rate spread on its HMDA LAR?

A. Loan to remodel a 60-unit apartment complex

B. A loan to renovate a rental property

C. An unsecured loan to purchase an investment property

D. A home improvement loan secured by a principal dwelling

D. A home improvement loan secured by a principal dwelling

Reg. C: 12 CFR 1003.4(a)12

By what date must financial institutions submit their loan application registers to their federal supervisory agency?

A. March 31 of the year following the calendar year for which the data were compiled

B. March 1 of the year following the calendar year for which the data were compiled

C. February 1 of the year following the calendar year for which the data were compiled

D. April 1 of the year following the calendar year for which the data were compiled

B. March 1 of the year following the calendar year for which the data were compiled

Reg. C: 12 CFR 1003.5(a)

Which of the following loans would First National report on its loan application register?

A. A refinancing of the balance of a home purchase loan made fives years earlier; both loans will be secured by dwellings

B. A loan made to a couple, secured by their home, to pay for their children’s education

C. A bridge loan made to a newly transferred executive of a local company

D. A loan made to construct a principal dwelling

A. A refinancing of the balance of a home purchase loan made fives years earlier; both loans will be secured by dwellings

Reg. C: 12 CFR 1003.4(d) and Appendix A

Refinancings of home purchase loans when both loans are secured by dwellings are covered by the regulation.  New loans made for the purpose other than home improvement, home purchase, and refinancing are not covered even if they are secured by real estate.  Temporary loans, such as bridge loans and construction loans are not covered.

When must a bank make its mortgage loan disclosure statement available?

A. Only when requested by its federal supervisory agency

B. At any time when requested by a member of the public

C. For 30 days following the receipt of a request from its supervisory agency

D. On an ongoing basis, by posting it in the lobby of each branch

B. At any time when requested by a member of the public

Reg. C: 12 CFR 1003.5(b) and (c)

The mortgage loan disclosure statement must be made available to the public no later than three days after its receipt from the FFIEC, and the statement must be available for five years.  The bank must post a notice of the public’s right to see the statement in the lobby of each office located within a metropolitan area.

What information must be on the loan application registers for home loans on property located within the bank’s metropolitan area?

A. The county, census tract, and metropolitan area of property

B. The address, census tract, and metropolitan area of property

C. The county, address, and fair market value of the property

D. The name, address, and metropolitan area of the applicant

A. The county, census tract, and metropolitan area of property

Reg. C: 12 CFR 1003.4(a)(9)

How must most banks submit loan application registers to their federal supervisory agencies?

A. In machine-readable format

B. On the standard LAR form

C. In three copies with the required transmittal

D. In a separate package for each branch loan application

A. In machine-readable format

Reg. C: 12 CFR 10034.4(a) and Appendix A

Banks with more than 25 LAR entries are required to submit electronically.  Otherwise, two hard copies must be sent with the transmittal letter.

Which of the following is required to be reported on ABC Bank’s HMDA LAR?

A. An application from Mr. Welch for preapproval of a home purchase loan application that is approved by ABC in writing but not accepted by Mr. Welch

B. An application from Ms. Ensley for a preapproval of a temporary construction loan that is denied by ABC

C. An application from Mr. and Mrs. Rawlings for a preapproval of a home purchase loan application that is denied by ABC

D. An application from Ms. Connor for a home equity loan to be used to consolidate credit cards

C. An application from Mr. and Mrs. Rawlings for a preapproval of a home purchase loan application that is denied by ABC

Reg. C: 12 CFR 1003.4(a)(4)

Applications for preapprovals fro home purchase loans must be reported if they are denied or if the loans are granted.  Applications for preapprovals that are approved by nor accepted are reportable at the institution’s option.  Applications for non-reportable loans (the interim construction loan in (B) and the home equity loan for a non-HMDA purpose) are never reportable. 

John and Elise Fernandez apply to ABC Bank for a loan to purchase a manufactured home.  ABC Bank is a community bank with approximately $100 million in assets, and the home would be located outside of the bank’s metropolitan area.  Mr. and Mrs. Fernandez complete an in-person application for a mobile home that is denied by the bank due to insufficient income.  Which piece of information on the Fernandez application is ABC Bank NOT required to report on its HMDA LAR?

A. The ethnicity of the applicants

B. The race of the applicants

C. The purpose of the loan application

D. The metropolitan area where the home will be located

D. The metropolitan area where the home will be located

Reg. C: 12 CFR 1003.4 and Appendix A(I)(C)

Because ABC Bank does not have an office in the metropolitan area where the property will be located, it does not have to report the property information on it LAR.  It may do so at its option.  All of the other info is required.

Which of the following loans or applications is EXCLUDED from HMDA reporting?

A. Residential loans purchased on the secondary market

B. Loans secured by real estate that are made for purposes other than home purchase, improvement, or refinancing

C. Loans on residential property in a flood zone when proof of flood insurance is provided

D. Applications for refinancing when there is no increase in principal

B. Loans secured by real estate that are made for purposes other than home purchase, improvement, or refinancing

Reg. C: 12 CFR 1003.4(a)

Only the types of loans mentioned in the “compilation of loan data” section are included in the coverage of HMDA – home purchase, home improvement, or refinancing.  Loans made for other purposes are not reportable.

For HMDA purposes, the term “dwelling” does NOT include which of the following?

A. Timeshares

B. Single family dwellings

C. Individual condominiums

D. Mobile homes not attached to real property

A. Timeshares

Reg. C: 12 CFR 1003.2

The definition of “dwelling” does no include timeshares.

Which of the following representations on the HMDA loan application register is a violation of Regulation C?

A. The MSA number, instead of the MSA name, is used for each loan and application

B. The “reasons for denial” column is blank

C. Race, national origin, and gender information are not included for purchased loans

D. The gender of the applicant is designated by the letters M or F

D. The gender of the applicant is designated by the letters M or F

Reg. C: 12 CFR 1003.4 and Appendix A I(d)(5)

Codes must be used to indicate the sex of the applicant – not the letters M and F.

An individual borrowed $1,000 to remodel her mobile home.  She lives in the mobile home that is not anchored to the ground.  The loan will be secured by the mobile home, but the borrower does not own the lot on which it is parked.  For HMDA purposes, this loan is considered to be which of the following types of loans?

A. Consumer RV

B. Home equity

C. Home improvement

D. Second mortgage

C. Home improvement

Reg. C: 12 CFR 1003.2

The definition of dwelling includes mobile homes not attached to real property.

Under HMDA, what is the threshold for reporting the interest rate spread for first lien mortgage loans?

A. Over 1.5 percentage points

B. Over 5 percentage points

C. Over 7 percentage points and when the loan is subject to the Home Ownership and Equity Protection Act

D. Less than 8 percentage points but greater than 5 percentage points

A. Over 1.5 percentage points

Reg. C: 12 CFR 1003.4(a)(12)

In review of a bank’s home mortgage loan application register, which of the following must be included in Regulation C reporting?

A. Loans made or purchased in a fiduciary capacity

B. Servicing rights purchased

C. Interim construction loan applications

D. Loans made and sold within the reporting period

D. Loans made and sold within the reporting period

Reg. C: 12 CFR 1003.4(d)

All of the loans described are excluded from coverage except for loans made and sold within the reporting period.