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How the New HMDA 2018 Rules Increase Risk for Fines

Jun 7, 2017 by Brian Arnesen

In 2017, more lenders will be subjected to HMDA. Under the new rules, the CFPB estimates that there would be  a 40% increase in the total number of transactions under the new data collection and submission requirements. 

HMDA Is Changing In 2018
      New loans types such has HELOC reporting, Mixed Use changes, and Reverse Mortgages are subject to the new HMDA changes. In conjunction with more loans being subjected to HMDA requirements, the number of submitted fields will more than double. Currently, there are 44 submitted fields, but that will soon increase to 110. These new fields and lending channels are likely to produce up to a 10x increase in errors compared to previous errors. 

Feeling overwhelmed. Don't worry, there are solutions that can reduce processing times and error rates by up to 90%. Whether you're a lender with just 25 loans or submitting millions of records, our software provides a more efficient and accurate way to stay ahead of regulations.

The new CFPB HMDA data requirements also allow examiners to have the ability to automate a fair lending analysis before they meet with you. Additionally, based on a new standard for pricing data submissions and universal rate spread calculations, publicly published data will now result in every lender knowing the pricing practices of its peers. Not only will regulators now be able to identify if you are a fair lending offender within minutes of your submission, but your competitors will also know your profit margins and pricing strategy.

There are both challenges and advantages to this new world of transparent data availability. We believe you can use this additional data to protect yourself from false accusations and promote more responsible and profitable lending based on the newly expanded peer data. Through data, you can prove how your fair lending efforts exceed your peers.

In order to better assist our customers, QuestSoft has established a relationship with the HMDA Academy early on to provide FREE access to our Compliance Relief customers until their first submission in March 2019. Still have questions? Check out QuestSoft's HMDA Frequently Asked Questions page.