Home mortgage disclosure (Regulation C): Public disclosure of mortgage lending data; revised formats,
[Federal Register: March 25, 2004 (Volume 69, Number 58)]
[Proposed Rules]
[Page 15469-15559]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr25mr04-23]
[[Page 15469]]
Part III
Federal Reserve System
12 CFR Part 203
Home Mortgage Disclosure; Proposed Rule
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FEDERAL RESERVE SYSTEM
12 CFR Part 203
[Regulation C; Docket No. R-1186]
Home Mortgage Disclosure
AGENCY: Board of Governors of the Federal Reserve System.
ACTION: Proposed rule; request for comment on revised formats for public disclosure of lending data.
SUMMARY: The Board is soliciting comment on revised formats for public disclosure of mortgage lending data reported pursuant to the Home Mortgage Disclosure Act and Regulation C, in light of revisions to Regulation C requiring lending institutions to report new loan pricing and other loan data. The first year for which the new data will be reported is 2004; data from institutions are due no later than March 1, 2005, and the data will be reflected in the public disclosures scheduled to be released in summer 2005.
DATES: Comments must be received by May 10, 2004.
ADDRESSES: Comments should refer to Docket No. R-1186 and may be mailed to Jennifer J. Johnson, Secretary, Board of Governors of the Federal Reserve System, 20th Street and Constitution Avenue, NW., Washington, DC 20551. Please consider submitting your comments through the Board's Web site at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm,
by e-mail to regs.comments@federalreserve.gov, or by fax to the Office of the Secretary at 202/452-3819 or 202/452-3102. Rules proposed by the Board and other federal agencies may also be viewed and commented on at http://www.regulations.gov.
All public comments are available from the Board's Web site at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm as submitted,
except as necessary for technical reasons. Accordingly, your comments will not be edited to remove any identifying or contact information. Public comments may also be viewed electronically or in paper in Room MP-500 of the Board's Martin Building 20th and C Streets, NW.) between 9 a.m. and 5 p.m. on weekdays.
FOR FURTHER INFORMATION CONTACT: Glenn Canner, Senior Adviser, Division of Research and Statistics, at (202) 452-2910; or John C. Wood or Kathleen C. Ryan, Counsel, Division of Consumer and Community Affairs, Board of Governors of the Federal Reserve System, Washington, DC 20551, at (202) 452-3667 or (202) 452-2412. For users of Telecommunications Device for the Deaf (TDD) only, contact (202) 263-4869.
SUPPLEMENTARY INFORMATION:
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Background
The Home Mortgage Disclosure Act (HMDA), 12 U.S.C. 2801 et seq., requires certain depository and for-profit nondepository institutions to collect, report, and publicly disclose data about applications for, and originations and purchases of, home purchase and certain other home-secured loans (such as refinanced home purchase loans) and home improvement loans (whether secured or unsecured). The Board's Regulation C, 12 CFR Part 203, implements HMDA. The data reported include the application date; the type, purpose, and amount of the loan or application; the date and type of action taken on the application; the location of the property to which the loan relates; the race, ethnicity, sex, and income of the applicant or borrower; the type of purchaser if the loan is sold; and the reasons for denial if the application is denied.
Pursuant to section 304(h) of HMDA, lending institutions subject to the act report data on the HMDA Loan/Application Register (HMDA-LAR) in a loan-by-loan and application-by-application form. The data are then submitted to the federal financial regulatory agencies. Sections 304 and 310 of HMDA direct the Federal Financial Institutions Examination Council (FFIEC) to edit and process the data and to produce public disclosure statements, which are sent back to the reporting institutions to be made available to the public upon request. In addition, the FFIEC sends the institutions' public disclosure statements to central depositories (such as public libraries) in each metropolitan statistical area (MSA), along with aggregate disclosures covering all reporting institutions in that MSA. Under section 304(h) of HMDA, the Board--in cooperation with the Office of the Comptroller of the Currency (OCC), the Office of Thrift Supervision (OTS), the Federal Deposit Insurance Corporation (FDIC), the National Credit Union Administration (NCUA), and the Department of Housing and Urban Development (HUD)--is directed to develop the format for the public disclosures.
The Board recently completed a review of Regulation C (see 67 FR 7222, February 15, 2002, and 67 FR 43217, June 27, 2002). Amendments to the regulation adopted as a result of the review require institutions to report new items, including a rate spread between the annual percentage rate (APR) on the loan and the yield on Treasury securities of comparable maturity; whether the loan is subject to the Home Ownership and Equity Protection Act (HOEPA); whether manufactured housing is involved; the type of lien on the property (first, subordinate, or none); and certain information about requests for preapproval. In addition, the regulation was amended to conform to changes in standards for collection of applicant data on race and ethnicity adopted by the Office of Management and Budget (OMB). The first year for which the new data will be reported is 2004; data from institutions must be submitted to the appropriate federal financial regulatory agency no later than March 1, 2005, and the data will be reflected in the public disclosures scheduled to be released in summer 2005.
To facilitate public access to the new information that will be reported, in keeping with the purposes of the act, the formats for the public HMDA disclosure statements will be revised. The Board and the other regulatory agencies seek public comment on the proposed formats for the revised disclosure statements. The proposed changes include revisions to some of the existing disclosure tables, deletion of one set of existing tables, and the addition of new tables.
The proposed revisions to the existing tables are primarily to reflect the changes to the race and ethnicity categories adopted by OMB and the itemization of data on manufactured housing. One series of tables (Tables 6-1 through 6-6) would be deleted because of their perceived lack of utility to HMDA data users. The proposed new tables reflect new data on rate spread, HOEPA status, lien status, preapproval requests, and manufactured housing. Comment is solicited on these proposed revisions, deletions, and additions.
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Explanation of Proposed Revised Disclosure Formats
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Revisions to Existing Tables and Series of Tables
The existing tables for each reporting financial institution are Tables 1, 2, 3, 4-1 through 4-6, 5-1 through 5-6, 6-1 through 6-6, 7-1 through 7-6, and 8-1 through 8-6, and Supplemental Tables 1 and 2. There are also aggregate versions of Tables 1 through 8-6, reflecting the aggregated data of all reporting financial institutions in each MSA. In addition, there are Aggregate Tables 9 and 10, but no versions of these tables for individual financial institutions. In each case, the same
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changes that would be made to the basic individual institution tables (1 through 8-6) would also be made to the aggregate and supplemental versions. For example, Table 1, Aggregate Table 1, and Supplemental Table 1 would be revised in the same way. 1. Table 1 and Supplemental Table 1--Disposition of Loan Applications, by Location of Property and Type of Loan
Existing Table 1 shows action taken on loan applications (such as loan originated, application approved but not accepted, application denied), detailed by the census tract in which a property is located. The table also shows the type of loan (government-backed 1-to-4 family home purchase loans, conventional 1-to-4 family home purchase loans, 1- to-4 family refinancings, 1-to-4 family home improvement loans, multifamily loans, and loans on 1-to-4 family non-owner-occupied property).
Institutions are required to report property location (generally MSA, state, county, and census tract) for loans on property located in MSAs in which they have home or branch offices. Therefore, for each reporting institution, Table 1 is produced for each MSA in which the institution has offices. In addition, some institutions are required by the regulations implementing the Community Reinvestment Act (12 U.S.C. 2901 et seq.) to report property location for all loans, no matter where the property is located, and some institutions voluntarily choose to do so. In these cases, Supplemental Table 1 is produced to reflect the same information as Table 1 for loans on property not located in MSAs where the institution has offices.
The only substantive change to Table 1 (and Aggregate Table 1 and Supplemental Table 1) is the addition of a new column G to provide separately itemized data for loan applications for manufactured housing. Existing Table 1 shows combined data covering both manufactured housing loans and 1-to-4 family housing loans. The revised table would continue to include manufactured housing loans along with 1-to-4 family loans in columns A, B, C, and D, and the heading for these columns would be changed to reflect this fact. 2. Table 2 and Supplemental Table 2--Loans Purchased, by Location of Property and Type of Loan
Existing Table 2 shows loans purchased by the institution, detailed by census tract and by type of loan, using the same loan types as in Table 1. As with Table 1, Table 2 is produced for each MSA in which the institution has offices. Supplemental Table 2 reflects the same information as Table 2, for loans on property not located in MSAs where the institution has offices.
The only changes to Table 2 (and to Aggregate Table 2 and Supplemental Table 2) would be the same as to Table 1: The addition of a column G for manufactured housing loans and the change in the heading for columns A, B, C, and D to reflect the fact that data in those columns include manufactured housing loans. 3. Table 3--Loans Sold, by Characteristics of Borrower and of Census Tract in Which Property Is Located and by Type of Purchaser
Existing Table 3 shows loans sold by the institution, detailed by the race, sex, and income of the borrower; by the racial and income characteristics of the census tract in which the property is located; and by the type of entity that purchased the loan (such as Fannie Mae, commercial bank, or affiliate of the institution). Table 3 is produced for each MSA in which the institution has offices.
The types of purchasers shown in Table 3 would be conformed to the revised categories for type of purchaser used under the amended Regulation C. The changes included combining the commercial bank and savings institution categories; adding credit unions, mortgage banks, and finance companies to the life insurance company category; adding a new category for private securitization; and nonsubstantive terminology changes.
Table 3 would also reflect the changes in borrower characteristics collected under the Regulation C revisions. The Regulation C revisions conform to standards for collection of data on race and ethnicity adopted by OMB. The OMB standards allow individuals to self-identify using more than one racial category, treat ethnicity and race as separate items of information, separate ``Asian or Pacific Islander'' into two categories (``Asian'' and ``Native Hawaiian or Other Pacific Islander,'') eliminate the category ``Other,'' and make nonsubstantive terminology changes.
The racial categories in revised Table 3 follow the new categories adopted in revised Regulation C. To reflect loans where the applicant has marked more than one minority race, a new category entitled ``2 or More Minority Races'' would be added. Where the applicant chose white and one minority race category (for example, Asian) the loan would be reflected in the data for the minority race (Asian, in this example). Ethnicity would be shown separately from race, using the categories ``Hispanic or Latino,'' ``Not Hispanic or Latino,'' ``Joint (Hispanic or Latino/ Not Hispanic or Latino),'' and ``Ethnicity Not Available'' (paralleling ``Race Not Available''). ``Joint (Hispanic or Latino/ Not Hispanic or Latino)'' would apply where one joint applicant is Hispanic or Latino and the other is not, paralleling the ``Joint'' category under race which applies where one applicant is minority and the other is white.
In the racial categories in revised Table 3, white is divided into ``White--Hispanic or Latino'' and ``White--Not Hispanic or Latino,'' to allow data users to better focus on data about lending to minorities more generally, and to provide some continuity with data generated under the existing HMDA disclosures (in that ``White--Not Hispanic or Latino'' in the proposed revised disclosures appears to be substantially equivalent to ``White'' in the existing disclosures). For similar reasons, revised Table 3 contains a data line entitled ``Total Minority,'' which aggregates loan data from all categories except ``White--Not Hispanic or Latino'' and ``Race Not Available.''
The section of Table 3 detailing loans sold by sex of the borrower--which appears not to have great utility for most data users-- would be deleted. The information can be derived from the institution's HMDA-LAR, which is available to the public directly from the institution.
The section of Table 3 showing loans sold by income of the borrower remains unchanged. The section showing loans sold by racial/ethnic composition of census tracts and by income of census tracts also remains unchanged, except for a possible change affecting loans on property in the Commonwealth of Puerto Rico.
The existing public disclosure tables for MSAs in Puerto Rico contain no data in the section on racial/ethnic composition of census tracts, because in the decennial censuses up to and including 1990, this information was not collected for areas in Puerto Rico. In the 2000 census, information was collected on the racial and ethnic composition of census tracts in Puerto Rico, and Table 3 for MSAs in Puerto Rico could be revised to show the data. The census tract data from all MSAs are rolled up into national aggregates, which are not part of the public HMDA disclosures sent to central depositories, but are available from the FFIEC. Inclusion of the Puerto Rico census tract data now, after excluding them in the past, could make trend analysis at the national level more difficult.
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The revised format for Table 3 contained in this proposal includes the census tract data for MSAs in Puerto Rico. Comment is solicited on whether the national aggregate tables should include or exclude the Puerto Rico census tract data. 4. Table 4 Series--Disposition of Applications, by Race, Ethnicity, Gender and Income of Applicant
The existing tables in the Table 4 series show action taken on applications for various types of loans, detailed by race/national origin of applicants and further itemized by sex of applicants, and detailed by income of applicants. There is one table for each type of loan, using the same loan types as in Table 1. Thus, Table 4-1 shows disposition of applications for government-insured and government- guaranteed home purchase loans on 1-to-4 family dwellings; Table 4-2 shows disposition of applications for conventional home purchase loans on 1-to-4 family dwellings; Table 4-3 shows disposition of applications for refinancings on 1-to-4 family dwellings; Table 4-4 shows disposition of applications for home improvement loans on 1-to-4 family dwellings; Table 4-5 shows disposition of applications for loans on multifamily dwellings; and Table 4-6 shows disposition of applications for loans on 1-to-4 family non-owner-occupied property. Each of these tables is produced for each MSA in which the institution has offices.
The changes to the tables in the Table 4 series parallel changes to Table 3 with regard to the race and ethnicity categories, as described above. Within each of these categories, itemized data would also be shown for Male, Female, and Joint (applying where one joint applicant is male and the other is female). A section with data on ``Total Minority'' would be calculated the same way as in Table 3 and would include detail on Male, Female, and Joint.
As in Table 3, the section in the Table 4 series showing action taken on applications by income of applicants remains unchanged. The titles of the tables also remain unchanged except that ``1-to-4 Family and Manufactured Home Dwellings'' replaces ``1-to-4 Family Homes'' in Tables 4-1, 4-2, 4-3, 4-4, and 4-6, which continue to include manufactured homes along with 1-to-4 family homes. ``Ethnicity'' is added to the titles on each of the tables, since ethnicity is now treated as a separate item of data from race.
A new Table 4-7 would be added, titled ``Disposition of Applications for Home Purchase, Home Improvement, or Refinancing Loans, Manufactured Home Dwellings, by Race, Ethnicity, Gender and Income of Applicant.'' The data shown would be the same as in the other tables in the Table 4 series, as revised, except that the data would relate to manufactured home loan applications. Thus, the data in Table 4-7 will be a subset of the data in Tables 4-1, 4-2, 4-3, and 4-4. In this respect, new Table 4-7 parallels the new columns covering manufactured home loans and applications in Tables 1 and 2. 5. Table 5 Series--Disposition of Applications, by Income, Race and Ethnicity of Applicant
The existing tables in the Table 5 series show action taken on applications for various types of loans, detailed by race/national origin of applicants and further itemized by income of applicants. There is one table for each type of loan, using the same loan types as in the Table 4 series; the two series of tables differ only in how the data are itemized.
The changes mirror those made to the Table 4 series. The race/ national origin categories are changed, and ethnicity added in a separate section of data; the table titles are conformed; and a new Table 5-7 shows data for manufactured home loan applications. 6. Table 6 Series--Disposition of Applications, by Income and Gender of Applicant
The existing tables in the Table 6 series show action taken on applications for various types of loans, detailed by income of applicants and further itemized by sex of applicants. Again, there is one table for each type of loan. The Table 6 series parallels the 4 and 5 series; the only difference is in how the data are itemized.
The agencies propose to eliminate the Table 6 series as redundant. The agencies believe that the Table 6 series is used very infrequently. Information on lending patterns by income and sex of loan applicants remains available in the 4 and 5 series of tables, as well as through the modified HMDA-LAR data that are also publicly available. 7. Table 7 Series--Disposition of Applications, by Characteristics of Census Tract in Which Property is Located
The existing tables in the Table 7 series show action taken on applications, using the same types of loans as in the 4, 5, and 6 series, but in this case detailed by the racial/ethnic composition and median family income of the census tract in which the property is located.
The Table 7 series remains unchanged, except for the addition of a Table 7-7 to reflect manufactured home loan applications, and the inclusion of data from census tracts in Puerto Rico. The issues for the Table 7 series with regard to the Puerto Rico census tract data are the same as for Table 3; refer to the discussion of Table 3 above. 8. Table 8 Series--Reasons for Denial of Applications, by Race, Ethnicity, Gender, and Income of Applicant
The existing tables in the Table 8 series cover applications that have been denied, and show the reasons for denial detailed by the race, sex, and income of the loan applicant. As in the other series, there is one table for each type of loan, using the same loan types.
The changes made to the Table 8 series mirror those in the 4 and 5 series in regard to the race/ethnicity categories and inclusion of ethnicity as a separate item of data. A new Table 8-7 shows reasons for denial of manufactured home loan applications. 9. Aggregate Table 9--Disposition of Loan Applications, by Median Age of Homes in Census Tract in Which Property Is Located and Type of Loan
Existing Aggregate Table 9 shows action taken on loan applications, by median age of properties within census tracts where the subject property is located and by type of loan. The Aggregate Table 9 for each MSA covers the aggregated data for all reporting institutions in that MSA; no Table 9 is produced for individual financial institutions.
Proposed changes to Aggregate Table 9 include adding a column to reflect data on manufactured home loan applications and updating the ranges of median ages of homes by ten years. A section of data covering median ages from 1990 through March 2000 will be added at the beginning of the table; the section covering median ages of 1949 or earlier, at the end of the existing Aggregate Table 9, will be deleted; and the range 1950-1959 in the existing table will be changed to 1959 or earlier. The updated ranges will be used beginning with the disclosures covering 2003 lending data, scheduled to be published in summer 2004. 10. Aggregate Table 10--Disposition of Loan Applications, by Principal City versus Non-Principal City Property Location and Type of Loan
Existing Aggregate Table 10 shows action taken on loan applications, by property location and by type of loan. The property location itemization consists of only two categories: Central
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city in the given MSA, and any other location in that MSA outside the central city. No Table 10 is produced for individual financial institutions.
Changes that would be made to Aggregate Table 10 include adding a column for data on manufactured home loan applications and substituting ``principal city'' for ``central city,'' to reflect terminology adopted by OMB.
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New Tables and Series of Tables
A number of new tables would be produced to reflect new data items that are being collected under revised Regulation C on loan pricing (the rate spread), HOEPA status, lien status, and preapproval requests. The new tables would also reflect manufactured home lending in more detail than is given in the revised existing tables. 1. Table 11 Series--Pricing Information for Conventional Loans on 1-to- 4 Family Owner-Occupied Dwellings
Under revised Regulation C, institutions must report the rate spread between the APR on the loan and the yield on Treasury securities of comparable maturity for loans subject to the Truth in Lending Act (TILA), since these loans will have an APR for use in calculating the rate spread. Loans on 1-to-4 family owner-occupied homes are generally subject to TILA, and accordingly the new Table 11 series would focus on this category of loans. (Loans for owner-occupied manufactured homes are also subject to TILA, and are covered in Table 12, as discussed below.) The tables would focus on conventional loans, because concern about possible loan pricing problems has centered on conventional, rather than government-backed, lending. Loan pricing data on government-backed lending are available to the public on institutions' HMDA-LARs.
The Table 11 series comprises Tables 11-1 through 11-6. Table 11-1 covers conventional first-lien home purchase loans on 1-to-4 family owner-occupied dwellings. It would show, for a given reporting institution in each of the institution's MSAs, the number of such loans for which the institution did not report rate spread data because the difference between the APR on the loan and the yield on the applicable Treasury security was below the three percentage point reporting threshold for first-lien loans. It would also show the number of such loans for which the institution reported rate spread data. The table would then show the number of loans falling into various ranges of percentage points above the applicable Treasury yield, such as 3-3.99, 4-4.99, and so on up to 8 percentage points or more above the Treasury yield. The table would also show, for loans on which the institution reported rate spread data, the mean and median percentage points above the Treasury yield.
The data in Table 11-1 would be itemized by the race, ethnicity, income, and sex of the borrower, and by the racial/ethnic composition and the income of the census tract in which the property is located. The categories used for the borrower and census tract characteristics will be identical to those used in the other tables, as revised.
Table 11-2 will show rate spread data on the same types of loans as Table 11-1, secured by subordinate liens. Tables 11-3 and 11-4 are parallel to Tables 11-1 and 11-2, except that Table 11-3 covers first- lien refinancings and Table 11-4 covers subordinate-lien refinancings. Tables 11-5 and 11-6, likewise, reflect data on first-lien home improvement loans and subordinate-lien home improvement loans, respectively. There is no table showing rate spread data for unsecured home improvement loans; under revised Regulation C, institutions are not required to report the rate spread for unsecured home improvement loans.
Tables 11-3 through 11-6 each include an additional column showing the number of HOEPA loans made by the institution in the particular MSA. (Under TILA, home purchase loans on 1-to-4 family owner-occupied dwellings are excluded from HOEPA coverage; thus, there is no comparable HOEPA column in Tables 11-1 or 11-2.)
The ranges selected in the table formats for rate spread data are intended to focus on the most useful data. The highest range would be 8 percentage points or more over the comparable Treasury yield for first- lien loans, and 10 percentage points for subordinate-lien loans. It is expected that, for most lenders, the number of loans falling into this category would be few or none. Therefore, ranges beyond 8 or 10 percentage points above the Treasury yield would appear to have little utility. In addition, data users will be able to derive data on ranges at higher rates from the publicly available HMDA-LAR data.
One of the triggers for HOEPA coverage is an APR 8 or more percentage points over the comparable Treasury yield for first-lien loans, and 10 or more percentage points over the comparable Treasury yield for subordinate-lien loans. Thus, for the tables with a column showing the number of HOEPA loans, there could be some similarity between the data in that column and the data in the column showing number of loans with an APR of 8 or more (or 10 or more, for subordinate-lien loans) percentage points over the comparable Treasury yield. However, there are some differences between the two columns. First, the Treasury yield for HOEPA trigger purposes is the yield in the calendar month before the month in which the lender receives the loan application; the Treasury yield for HMDA rate spread purposes is the yield in the month before the date on which the interest rate on the loan is locked. Therefore, while the two yields may often be identical, they may not be in some cases. Second, a loan can be classified as a HOEPA loan even though it does not meet the APR trigger, if it meets the trigger for HOEPA coverage based on the loan's points and fees. 2. Table 12--Disposition of Applications and Pricing Information for Conventional Manufactured Home Purchase Loans, First Lien, Owner- Occupied Dwellings, by Borrower or Census Tract Characteristics
New Table 12 would focus on manufactured home lending and would show two types of information: Information on action taken on applications, and rate spread information for originated loans. The table would be limited to conventional first-lien home purchase loans on owner-occupied dwellings for three reasons. First, it is expected that the great majority of manufactured home loan applications fall into this category. Second, loans on non-owner-occupied properties are generally not subject to TILA and thus will not have an APR available for calculating rate spread. And third, with regard to the focus on conventional lending, the concern about loan pricing has focused on this area rather than on government-backed lending, as in the case of loans on 1-to-4 family dwellings discussed above.
For both the action taken section and the rate spread section, Table 12 itemizes the data by the race, ethnicity, income, and sex of the applicant, and by the racial/ethnic composition and income of the census tract where the property is located. The categories used for the borrower and the census tract characteristics are identical to those used in the revised existing tables and in the new Table 11 series.
Table 12's section on action taken bears some similarity to new Tables 4-7, 5-7, and 7-7, which also display action taken data relating to manufactured home lending, but there are significant differences. Tables 4-7, 5-7, and 7-7 show activity on all manufactured home lending (home purchase, home improvement, and refinancings; both conventional and
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government-backed; both owner-occupied and non-owner-occupied; and both first-lien and subordinate-lien), while Table 12 is limited to conventional first-lien home purchase loans on owner-occupied manufactured homes.
The rate spread section of Table 12 is similar to the Table 11 series, except that the columns showing the numbers of loans with rate spreads falling into various ranges are omitted. Thus, the rate spread data in Table 12 include columns for the number of loans with no reported pricing data, the number of loans with such data reported, and the mean and median percentage points over the applicable Treasury yield for those loans with pricing data reported. The agencies believe that this information would be sufficient for analysis, because it appears that on average rates in manufactured housing lending may be higher than in other mortgage lending, such that most loans would have rate spreads significantly in excess of the thresholds. Again, as in other cases, the more detailed information can be derived from the publicly available HMDA-LAR data. Comment is solicited, however, on whether Table 12 should be modified to display more detailed rate spread data.
Also, the rate spread section of Table 12 is limited to home purchase loans, while the Table 11 series also has tables covering refinancings and home improvement loans. As noted above, however, the majority of manufactured home loan applications may fall within the home purchase category. In addition, Summary Table B, discussed below, provides some information on rate spreads for refinancings and home improvement loans on manufactured housing. 3. Summary Table A Series--Disposition of Applications and Loan Sales by Loan Type
The Summary Table A series would provide an overview of actions taken by an institution on loan applications with a detailed itemization by type of loan. Summary Table A-1 would show action taken on applications for loans on 1-to-4 family dwellings; Summary Table A-2 would show the same data for applications on manufactured home loans; and Summary Table A-3 would show the same data for applications relating to multifamily housing, except that it would not contain data on preapproval requests; lending on multifamily housing would likely not generally involve preapproval requests as defined in Regulation C.
The tables would itemize lending by (1) loan purpose (home purchase, refinancing, and home improvement); (2) lien status (first- lien, subordinate-lien, and unsecured); (3) loan type (conventional, FHA (Federal Housing Administration), VA (Veterans Administration), and FSA/RHS (Farm Service Agency or Rural Housing Service)); and (4) action taken. The tables would not show itemization by applicant or census tract characteristics; tables in the 4, 5, and 7 series serve that purpose. Rather, these summary tables would detail at a glance the types of lending in which an institution is engaged.
The summary tables would be produced in two versions for each reporting institution. One version would reflect activity for each MSA for which the institution reports data and the other would show the institution's total activity nationwide. Both versions would itemize data by type of action taken (such as loans originated, applications approved but not accepted, and applications denied). In addition, both versions would show the number of preapproval requests that resulted in loan originations and the number of loans sold by the institution.
Only the nationwide version would show preapproval requests denied and preapproval requests approved but not accepted. Data on preapproval requests denied and preapproval requests approved but not accepted cannot be shown in the MSA version, because to be included in these tables a loan must have a property location, and property location is not reported on a preapproval request unless the request goes beyond the preapproval stage, for example, where it results in a loan origination. 4. Summary Table B--Loan Pricing Information for Conventional Loans by Incidence and Level
Summary Table B would show rate spread and HOEPA status information for an institution as a whole, itemized in a manner similar to the Summary Table A series (by home purchase, refinancing, and home improvement; and by first-lien and subordinate-lien status). Summary Table B would be limited to conventional loans because concerns about loan pricing have focused primarily on this area. Summary Table B would not contain data on multifamily housing loans or on unsecured home improvement loans, because rate spread and HOEPA status data are not available for such loans.
Like the A series, Summary Table B would be produced in two versions for each reporting institution, one version reflecting the activity of that institution for each MSA for which the institution reports data, and another version showing the institution's total activity nationwide.
In some respects, Summary Table B would display data comparable to that shown in the Table 11 series and in Table 12. For example, Table 11-1 shows rate spread data for conventional first-lien home purchase loans on owner-occupied 1-to-4 family dwellings; the first column in Summary Table B shows the same type of data. Table 11-2 relates to subordinate-lien loans, as does the second column in Summary Table B. There are differences, however. First, the tables in the Table 11 series do not show the total number of loans for the institution, but instead provide itemizations by borrower and census tract characteristics. Summary Table B provides total loan numbers (in various categories of pricing information, such as no pricing reported, pricing reported, and so on), both at the MSA level and in total activity nationwide. In addition, the nationwide version of Summary Table B would include loans for which no property location was reported (for example, because the property is located outside the MSAs in which the institution has offices), while the Table 11 series does not include such loans. Thus, a data user could use Summary Table B to determine at a glance the overall level of an institution's loan pricing, detailed by loan type.
While Summary Table B and Table 12 both focus partly or wholly on manufactured housing lending data, there are differences. First, Summary Table B shows total numbers of loans for an institution (in various categories of pricing information) both at the MSA level and nationwide, but does not include an itemization by borrower or census tract characteristics; Table 12 includes the itemization but not the totals. In addition, Table 12 provides data only on first-lien home purchase loans on manufactured housing, while Summary Table B also provides data on subordinate-lien home purchase loans, first- and subordinate-lien refinancings, and first- and subordinate-lien home improvement loans. Finally, Summary Table B shows data on HOEPA status for first- and subordinate-lien refinancings and for first- and subordinate-lien home improvement loans. No data for HOEPA status are shown for home purchase loans in either Table 12 or Summary Table B, because home purchase loans are excluded from HOEPA coverage under TILA.
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Issues on Which Comment Is Solicited
As discussed above, the Board proposes to revise the existing public
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disclosure tables; to eliminate the Table 6 series; and to add several new tables and series of tables. The Board solicits comment on any issues relating to the proposed revisions, deletions, and additions. In particular, should any of the existing tables, in addition to the Table 6 series, be deleted (and if so, why)? Should the Table 6 series be retained? Should any of the proposed revisions to the existing tables not be made, or should they be made in a different manner (for example, to display more, less, or different detail)? Should additional revisions to the existing tables be made? With regard to the proposed new tables, are any of them unnecessary, or should any of them be adopted in a modified form? Are any additional new tables needed?
The revised and new tables do not, of course, display mortgage lending information derived from the new data elements being reported in as great a level of detail as would be possible. Commenters are requested to bear in mind, however, that modified HMDA-LAR application- by-application and loan-by-loan data for all reporting institutions are available to the public upon request, and that data users thus have the ability to prepare analyses of mortgage lending patterns, relating both to actions taken on applications and to pricing of originated loans, in any way they choose.
List of Subjects in 12 CFR Part 203
Banks, Banking, Federal Reserve System, Mortgages, Reporting and recordkeeping requirements.
Text of Proposed Revisions
For the reasons set forth in the preamble, the Board proposes to adopt revised formats for public disclosure of mortgage lending data under the Home Mortgage Disclosure Act, as set forth in the attachment to this document.
By order of the Board of Governors of the Federal Reserve System, March 16, 2004. Jennifer J. Johnson, Secretary of the Board. BILLING CODE 6210-01-P
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[FR Doc. 04-6316 Filed 3-24-04; 8:45 am]
BILLING CODE 6210-01-C
