Collecting GMI on Non-HMDA Reportable Loans

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Question:

This question is regarding Reg B and HMDA, are there any instances when the ethnicity, race, and sex information should be collected for Reg B purposes, but not HMDA purposes (for instance, lines of credit with a primary purpose of purchasing or refinancing a principal dwelling)? Is it okay to collect the government monitoring information in these cases even if the loan is not HMDA applicable?

Answer:

Not only is it permissible, it is required that you do so. The circumstance you describe is a very accurate depiction, assuming your institution has opted to not report lines of credit for HMDA. Another example deals with temporary financing, HMDA has an exemption for temporary financing but Reg B does not. So a bridge loan that is secured by both the borrower's existing residence and new residence would be exempt from HMDA, but would still require Reg B GMI.

There is some overlap between data required for Reg B and data required for HMDA, but some distinctions too. Reg B requires collection of ethnicity, race, sex, marital status, and age. HMDA requires collection of ethnicity, race, sex, and gross annual income. To the extent information overlaps, you can use a single form to gather the information for either or both regulations.

First published on BankersOnline.com 7/10/06