WASHINGTON - The Federal Reserve Board has narrowed the exemption given to small, nonbank mortgage lenders under the Home Mortgage Disclosure Act.
The change roughly doubles the number, of independent mortgage lenders that must submit detailed annual data on mortgage loans and applications. The data have been used to gauge the extent of loan. discrimination against certain minority groups.
Under the amended HMDA rules, about 500 additional mortgage companies will have to report. Last year, 528 independents submitted data on mortgage loans and applications.
Standards of Inclusion
The new rule will require any mortgage company with an office in a metropolitan area to submit HMDA data if its assets exceed $10 million or if it makes at least 100 home-purchase loans annually. The threshold includes home refinancings but excludes home-improvement loans.
Previously, mortgage banks were exempted if the dollar value of their home loans equaled less than 10% of total loans.
The Fed acted after Congress called for a small-institution exemption for mortgage companies comparable to the one for banks and thrifts.
Under the earlier standard, mortgage companies not affiliated with banks were seen as getting a better break than other home lenders.