by Amy Kleinschmit, Director of Compliance


The Federal Financial Institutions Examination Council (FFIEC) recently made available the 2011 mortgage lending data from 7,632 financial institutions covered by Home Mortgage Disclosure Act (HMDA). The press release can be found here: http://www.ncua.gov/News/Press/NW20120918FFIEC2011MtgLendData.pdf

Since 2006, there has been a decreasing number of reporting institutions. Between 2011 and 2010 the number fell 4 percent. This decline likely reflects mergers, acquisitions and the failure of some institutions.

The 2011 data includes:

·         11.7 million home loan applications (of which nearly 7.1 million resulted in loan originations)

·         2.9 million loan purchases.

·         186,000 requests for preapprovals related to a home purchase that did not result in a loan.

Some of the data collected also includes information on “higher priced” loans. The 2011 data reflected that “the data on the incidence of higher-priced lending show that a small minority of first lien loans in 2011 have APRs that exceeded the loan price reporting thresholds. The principal exception was for conventional first lien loans used to purchase manufactured homes; for such loans 82 percent exceeded the reporting threshold in 2011. For conventional first lien loans used to purchase site-built properties, about 3.9 percent of the reported loans exceeded the reporting threshold (up from 3.3 percent in 2010). The incidence of higher-priced lending for FHA-insured loans on site-built properties (3.8 percent in 2011) is virtually the same as for conventional loans. The incidence of higher-priced lending for loans backed by VA guarantees is notably smaller than for either conventional or FHA-insured loans; only about 0.4 percent of VA-guaranteed loans were higher priced in 2011.” September 18, 2012, FFIEC Press Release.

HMDA data and fair lending examination and enforcement process. As explained by the FFIEC, “When examiners evaluate an institution's fair lending risk, they analyze HMDA data in conjunction with other information and risk factors, in accordance with the Interagency Fair Lending Examination Procedures (http://www.ffiec.gov/PDF/fairlend.pdf). Risk factors for pricing discrimination include, but are not limited to, the presence of broad pricing discretion and consumer complaints.” Id. However, HMDA data alone cannot be used to determine compliance with fair lending laws.

Financial institution disclosure statements, individual institutions’ LAR data, and MSA and nationwide aggregate reports are available at http://www.ffiec.gov/hmda. Refer to the HMDA data products at http://www.ffiec.gov/hmda/hmdaproducts.htm for the item descriptions and formats. More information about HMDA data reporting requirements is available in the Frequently Asked Questions on the FFIEC website at http://www.ffiec.gov/hmda/faq.htm.

Should you have any questions or concerns on this or any other compliance or regulatory topic, please do not hesitate to contact Amy Kleinschmit at akleinschmit@cuad.coop or 701.214.9721.