Q: Our residential loan department is originating loans which are investment properties/non-owner occupied. Would the bank be required to report the rate spread for HMDA purposes?
A: If the bank has determined that the loan is not subject to Reg. Z because it is primarily business or commercial purpose, then the rate spread would be reported as NA for HMDA purposes. On the other hand, if the bank has determined that this loan purpose is not primarily business purpose, then the rate spread would be reported for HMDA purposes, assuming no other exceptions apply.
- Rate spread – scope of requirement. If the covered loan is an assumption, reverse mortgage, a purchased loan, or is not subject to Regulation Z, 12 CFR part 1026, a financial institution complies with § 1003.4(a)(12) by reporting that the requirement is not applicable. If the application did not result in an origination for a reason other than the application was approved but not accepted by the applicant, a financial institution complies with
- 1003.4(a)(12) by reporting that the requirement is not applicable. For partially exempt transactions under
- 1003.3(d), an insured depository institution or insured credit union is not required to report the rate spread. See § 1003.3(d) and related commentary.
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