The 2015 HMDA Rule requires some financial institutions to report data on certain dwelling-secured, open-end lines of credit, including home-equity lines of credit. Prior to the 2015 HMDA Rule, Regulation C allowed, but did not require, reporting of home-equity lines of credit.
Since my original post I found this in the FDIC's 2013 HMDA Guide: "Home equity lines of credit (HELOCs) for home purchase or home improvement may be reported at the institution's option.
The following are excluded transactions: 1. 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.
The SAFE Act includes HELOCs. (1007.102). However, the SAFE Act does not mandate which documents the MLO number is to appear on. Reg Z (1026.36(g) identifies the Loan Documents that the MLO number must appear on under the Loan Originator rules.
Both the ECOA and the FCRA have adverse action requirements that may apply when a creditor suspends a HELOC or reduces the credit limit because of a significant decline in the value of a property.
The TILA-RESPA integrated disclosure rules and forms do not apply to HELOCs. Lenders are not required to provide the good faith estimate (HUD-1) described in Regulation X. Instead HELOCs are only subject to the special HELOC requirements in Regulation Z, which are substantially less consumer-friendly.
Any institution with loan origination of 200 or more open-end lines of credit must gather, record, and submit their reports to HMDA. However, if the loan or line of credit is not a closed-end mortgage loan or an open-end line of credit, it does not need to be reported.
The final rule increases the asset threshold for calendar year 2025 HMDA data collection and reporting to $58 million. As a result, banks, savings associations, and credit unions with assets of $58 million or less as of December 31, 2024, are exempt from collecting and reporting HMDA data for 2025 activity.
All mortgagees, lenders and loan correspondents that meet the requirements of Regulation C of the Federal Reserve Board must report HMDA data each year.
Occasionally, we receive questions about the disclosures necessary for home equity lines of credit (HELOCs). HELOCs are interesting, as they are open-end lines of credit governed by Subpart B of Reg Z, but also have their own rules under section 1026.40.
Identifying HMDA Reportable Transactions
Generally speaking, unless a transaction is expressly excluded under 12 C.F.R. §1003.3(c), an institution subject to HMDA must report all consumer closed‑end mortgage loans and open-end lines of credit secured by a dwelling.
Which type of loan transaction is NOT covered under the HMDA reporting requirements? Neither unsecured home improvement loans nor loans on unimproved land are covered transactions.
Like it or not, information about a home purchase or second loan (HELOC), and the terms and conditions of those loans, is recorded among the land records in the jurisdiction where the property is located.
Home equity lines of credit (HELOCs) may not be in the data even if intended for home improvement or home purchase because reporting HELOCs is optional. Additionally, not all mortgage lenders are HMDA reporters.
HMDA Platform by March 1, 2024. To determine if your credit union must submit HMDA data for calendar year 2023 activity, please review the. 2023 HMDA Institutional Coverage Chart . The NCUA expects every credit union required to report 2023 HMDA data to submit its file to the CFPB by the March 1, 2024, deadline.
The Truth in Lending Act (and Regulation Z) explains which transactions are exempt from the disclosure requirements, including: loans primarily for business, commercial, agricultural, or organizational purposes. federal student loans.
Section 1003.3(c)(3) provides that closed-end mortgage loans or open-end lines of credit obtained for temporary financing are excluded transactions.
Another form of housing credit omitted by the new CRA are home equity lines of credit. Many families rely on HELOCs not only to finance home improvements, but to pay for higher education for their children.
The exemption threshold is adjusted to increase to $58 million from $56 million. The adjustment is based on the 2.9 percent increase in the average of the CPI-W for the 12-month period ending in November 2024. Therefore, banks, savings associations, and credit unions with assets of $58 million or less as of Dec.
HELOCs are open-end credit and are not governed under the TRID regulations. You need to be delivering an early HELOC disclosure under 1026.40 and not an LE.
If a HELOC has a variable rate, but an optional fixed-rate feature, assume the HELOC is a variable rate transaction for purposes of the Section 32 threshold test.
Therefore, if it is a HELOC, it's exempt from HPML as Dan said. Sec. 226.5b Requirements for home equity plans.