Answer:
Refer to Section 226.32 of Reg Z. On the HMDA LAR, you must indicate whether the loan is or is not a HOEPA loan. Here's a quick summary of the HOEPA thresholds:
The requirements of this section apply to a consumer credit transaction that is secured by the consumer's principal dwelling and in which either:
1. The annual percentage rate at consummation will exceed by more than 8 percentage points for first-lien loans, or by more than 10 percentage points for subordinate-lien loans, the yield on Treasury securities having comparable periods of maturity to the loan maturity as of the fifteenth day of the month immediately preceding the month in which the application for the extension of credit is received by the creditor; or
2. The total points and fees payable by the consumer at or before loan closing will exceed the greater of:
a) 8 percent of the total loan amount (loans > $6,237.50); and
b) $499 (loans < $6,237.50; this figure is for 1-1-04 and shall be adjusted annually on January 1 by the annual percentage change in the Consumer Price Index.
Editors Note: A HOEPA Worksheet is in the Banker Tools to test loans for applicability.
First published on BankersOnline.com 5/2/05
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