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HMDA report Growing reliance on FHA-backed loans
WASHINGTON (9/21/10)--Data collected under the Home Mortgage Disclosure Act (HMDA)reflects a growing reliance on loans backed by the Fedearl Housing Administration (FHA) during the recent mortgage market difficulties. The FHA's share of first-lien loans increased to 37% in 2009, up from 26% in 2008 and 7% in 2007, the Federal Financial Institutions Examination Council (FFIEC) reported on Monday. The FFIEC released data covering mortgage-related “applications, originations, purchases of loans, denials, and other actions” at over 8,000 U.S. financial institutions. The data compile information on 15 million mortgage applications and 4.3 million loan purchases, as well as 210,000 pre-approval requests, and include “disclosure statements for each financial institution, aggregate data for each metropolitan statistical area (MSA), nationwide summary statistics regarding lending patterns, and Loan/Application Registers (LARs) for each financial institution, the FFIEC said. The HMDA data also include information on various types of loans, the property types of homes held under those loans, the location, and the sex, ethnicity, and income level of the homeowners. The report noted that the incidence of higher-priced lending for loan originations with applications taken before Oct. 1, 2009, was 5.7%. That same number decreased to 3.8% for loans originated after Oct. 1. The FFIEC has also compiled a similar report on private mortgage insurance (PMI) applications. Panelists at a recent Federal Reserve Board hearing on possible changes to its rules implementing HMDA discussed the possibility of bringing nondepository lenders under HMDA rules. Some members of the panel, which included Madison-Wis.-based UW CU Chief Credit Officer Mike Long, also stated that the asset size threshold for reporting loans under HMDA should be based on number of loans, instead of asset size, which is the current threshold. The potential inclusion of reverse mortgage loans under the HMDA reporting requirements was also discussed during the hearing. The panelists also said that financial institutions should be given 24 months to comply with any changes that are adopted.
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