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Home Mortgage Disclosure Act (HMDA) - UPDATED

The contents of this announcement will not cover all the HMDA rule changes in its entirety and will focus on the aspects that may alter how you deliver loans to Flagstar.

The Consumer Financial Protection Bureau issued a final rule amending Regulation C. HMDA requires certain financial institutions to collect, record, report, and disclose information about their mortgage lending activity. The final rule changes:
  • The types of financial institutions that are subject to Regulation C
  • The types of transactions that are subject to Regulation C
  • The data that financial institutions are required to collect, record, and report
  • The processes for reporting and disclosing HMDA data
Most provisions of the rule go into effect on January 1, 2018 and apply to data collected in 2018 and reported in 2019 or later. An institutional coverage change for depository institutions was effective January 1, 2017. Please refer to the HMDA Key Dates Timeline from the CFPB for the effective dates.

For data collected in or after 2018, the HMDA rule amends the requirements for collection and reporting of information regarding an applicants or borrower’s ethnicity, race, and sex. The CFPB published a Sample Data Collection Form that provides the required aggregated categories and disaggregated subcategories for ethnicity and race. LendingSpace will be updated to include the additional data required as displayed on the Sample Data Collection Form beginning on January 1, 2018.

The following will be required when delivering loans to Flagstar:
  • Lenders must provide Flagstar with the Universal Loan Identifier (ULI) on each transaction. The ULI must begin with the lenders Financial Institution Legal Entity Identifier (LEI), followed by up to 23 additional letters and/or numbers that the lender assigns, and end with a two-character check digit. The ULI must be used for only one application/loan and cannot be re-used. Lenders may visit the Global LEI Foundation website to obtain an LEI.
    The ULI may be provided to Flagstar on the bulk bid tape, electronically entered in the portal, and on documentation in the loan file.

  • For any delegated transaction purchased by Flagstar, Flagstar will report the loan as a purchase for HMDA purposes upon loan funding, however it is the correspondent’s responsibility to also report on loans in which the correspondent makes the credit decision.
Table Funded and Non-Delegated Transactions
Originators will be required to provide the additional information as displayed on the Sample Data Collection Form for any loan submitted to underwriting on or after January 1, 2018. In addition, Flagstar Bank will generate the Unique Loan Identifier (ULI) on all table funded and non-delegated correspondent transactions and report the final disposition of the transaction (withdrawn, incomplete, approved but not accepted, declined or originated if the loan closes).

Flagstar’s online 1003 will be updated with a new design which will also include the additional data required as displayed on the Sample Data Collection Form beginning on January 1, 2018. Correspondents registering non-delegated correspondent transactions will see the ULI field in the online 1003 but are not required to complete the field since Flagstar will generate the ULI on all non-delegated and table funded transactions. Click here to view a tutorial on the Loantrac online 1003 redesign.

California Wildfires

Purchasing may now resume for properties located in the zip codes listed in the Disaster Update document once a satisfactory re-inspection has been obtained.

If you have any questions, please contact your sales relationship manager.

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