Which of the following loans or applications is EXCLUDED from HMDA reporting?
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A. B. C. D.B
The Home Mortgage Disclosure Act (HMDA) is a federal law that requires certain lenders to collect and report data about their mortgage lending activities. The purpose of HMDA is to provide public access to information that can be used to help determine whether financial institutions are serving the housing needs of their communities and to detect and prevent discriminatory lending practices.
Among other requirements, HMDA requires lenders to report certain types of loans and applications to the appropriate federal agency. However, not all loans and applications are subject to HMDA reporting.
Out of the options provided, the loan or application that is EXCLUDED from HMDA reporting is:
B. Loans secured by real estate that are made for purposes other than home purchase, improvement, or refinancing.
This exclusion applies to loans that are secured by real estate, such as commercial loans, construction loans, and home equity loans, but are not made for the purpose of purchasing, improving, or refinancing a home.
A. Residential loans purchased on the secondary market are not excluded from HMDA reporting. Even if the lender did not originate the loan, they are still responsible for reporting the loan under HMDA if they meet the reporting requirements.
C. Loans on residential property in a flood zone when proof of flood insurance is not provided are not excluded from HMDA reporting. Lenders are required to report all loans secured by residential real estate, regardless of whether or not flood insurance was required.
D. Applications for refinancing when there is no increase in principal are not excluded from HMDA reporting. Refinancing applications are subject to HMDA reporting if they meet certain criteria, even if there is no increase in principal.