Mortgage Compliance Blog

mortgage compliance news

Sign up to receive our monthly newsletter!

4 Lessons Learned From 2017 HMDA Submissions

Mar 29, 2018 by Brian Arnesen

Every year, thousands of institutions submit their HMDA data to the CFPB. While many errors can be fixed by scrubbing your data on a regularly basis, there are always a few surprises during submission time. With a new CFPB HMDA submission platform, 2017 submissions were challenging.  In fact, QuestSoft facilitated 70% more HMDA submissions this year.

Here are 4 of the most common issues we experienced:

1. Syntactical Edit S025

There are several reasons why you may have encountered S025 edits in your HMDA submission to the CFPB this year:

  1. Outdated Compliance RELIEF software
  2. Incorrect Regulatory Agency
  3. Improperly formatted or incorrect Respondent ID
  4. Incorrect record on file at CFPB

    In many cases the data that got transferred from the FFIEC to the CFPB did not parse correctly in the CFPB HMDA Platform. Luckily, 2017 was the last year for using Respondent ID’s in HMDA. Next year, everyone will use their LEI. This, along with the fact that everyone who submitted this year should be on the CFPB’s panel next year, should greatly reduce S025 errors.

2. Selecting the Wrong Agency

Some submitters mistakenly chose the wrong agency code for 2017 HMDA submissions. Since this was the first year submitting to the CFPB, many people selected Agency Code (9) – CFPB for their Regulatory Agency. This was incorrect in most cases. Even though you submitted to the CFPB this year, your Regulatory Agency did not change.

Depending on your institution and its asset size, you should be selecting the agency that regulates your HMDA.

Your options include: (1)OCC, (2) FRS, (3) FDIC, (5) NCUA, (7) HUD, (9) CFPB

3. Platform Slowdowns

QuestSoft has been providing feedback to the CFPB about the HMDA Platform and the CFPB has been actively working to improve it. However, upload times continued to fluctuate during the last two weeks of February. At one point it was recommended to submit during off hours. We expect the CFPB to continue to make improvements to their HMDA Platform by the time 2018 submissions are due.

4. Not Using Automated Compliance Software

If you do fewer than 100 loans per year, you may find it acceptable to manually input those loans using the free CFPB HMDA LAR Formatting Tool. Be aware though, that you usually get what you pay for! The process can be quite burdensome.

automated hmda softwareUsing software such as HMDA RELIEF to routinely scrub your data makes the audit and submission process a lot smoother. Trying to fix errors without Group Edits or bulk geocoding is a time-consuming task. By importing your data on a quarterly or monthly basis to HMDA RELIEF, your submissions will be a piece of pie!

2018 submission will use the same CFPB HMDA Platform as 2017, but you will be submitting 3 times the data. With this expansion of data collection, there are now 215 validity errors and 42 quality checks. Each error code has new designations and multiple conditions that can be caused by a variety of factors. So be sure scrub your data frequently!

ContactUs