HMDA_LAR_20140722_omb

Supporting Statement for the
Information Collection Requirements Associated with the
Home Mortgage Disclosure Act and
Loan/Application Register required by Regulation C
(FR-HMDA-LAR; OMB No. 7100-0247)
Summary
The Board of Governors of the Federal Reserve System, under delegated authority from
the Office of Management and Budget (OMB), proposes to extend for three years, without
revision, the data collection requirements of the Home Mortgage Disclosure Act (HMDA),
including use of the Loan/Application Register (LAR) required by Regulation C, which
implements HMDA.1 Although the Consumer Financial Protection Bureau (CFPB) is now
responsible for issuing HMDA regulations, the Paperwork Reduction Act (PRA) requires the
Federal Reserve Board to renew every three years the information collections required of
institutions the Federal Reserve Board supervises. The PRA classifies reporting, recordkeeping,
or disclosure requirements of a regulation, including the HMDA/LAR, as an information
collection.2
The Federal Reserve Board accounts for the paperwork burden associated with the
regulation only for Federal Reserve Board-supervised institutions.3 The respondent burden for
the 531 Federal Reserve Board-supervised entities is estimated to be 127,652 hours.4
Background
HMDA was enacted in 1975 and is implemented by Regulation C. HMDA requires
depository and certain for-profit, non-depository institutions to collect, report to regulators, and
disclose to the public data about originations and purchases of home mortgage loans (home
purchase and refinancing) and home improvement loans, as well as loan applications that do not
result in originations (for example, applications that are denied or withdrawn). HMDA was
enacted to provide the public with loan data that can be used to: (1) help determine whether
financial institutions are serving the housing needs of their communities, (2) assist public
officials in distributing public-sector investments so as to attract private investment to areas

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HMDA is codified at 12 U.S.C. §§ 2801-2810; Regulation C is located at 12 CFR Part 1003.
44 U.S.C. § 3501 et seq. The collection of information under Regulation C (FR-HMDA-LAR) is assigned OMB
No. 7100-0247 for purposes of the PRA.
3
Other federal agencies account for the paperwork burden that Regulation C imposes on the institutions for which
they have administrative enforcement authority. These other federal agencies are: the Department of Housing and
Urban Development (HUD), the Federal Deposit Insurance Corporation (FDIC), the National Credit Union
Administration (NCUA), the Office of the Comptroller of the Currency (OCC), and the CFPB.
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The Federal Reserve Board accounts for the following types of institutions, except those that are supervised by the
CFPB: state member banks, their subsidiaries, subsidiaries of bank holding companies, U.S. branches and agencies
of foreign banks (other than federal branches, federal agencies, and insured state branches of foreign banks),
commercial lending companies owned or controlled by foreign banks, and organizations operating under section 25
or 25A of the Federal Reserve Act (12 U.S.C. 601-604a; 611-631). The CFPB supervises, among other institutions,
insured depository institutions with over $10 billion in assets and their affiliates (including affiliates that are
themselves depository institutions regardless of asset size and subsidiaries of such affiliates).
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where it is needed, and (3) assist in identifying possible discriminatory lending patterns and
enforcing anti-discrimination statutes.5
On July 21, 2011, rulemaking authority for HMDA was transferred from the Federal
Reserve Board to the CFPB under the Dodd-Frank Wall Street Reform and Consumer Protection
Act of 2010 (the Dodd-Frank Act). The Dodd-Frank Act also transferred HMDA supervisory
and enforcement authority for large depository institutions over $10 billion from the Federal
Reserve Board, FDIC, OCC, and NCUA to the CFPB.
Description of Information Collection
Regulation C generally requires a covered lender to report data about:




Each application or loan, including the application date; the action taken and the date of
that action; the loan amount; the loan type (for example, government guaranteed or not)
and purpose (for example, home purchase); and, if the loan is sold, the type of purchaser;
Each applicant or borrower, including ethnicity, race, sex, and income; and
Each property, including location and occupancy status.

A covered lender generally must record the data on each application and loan and submit
the completed LAR to the applicable supervisory agency. The Federal Financial Institutions
Examination Council (FFIEC) uses the submitted LAR data to prepare a “public disclosure
statement” and provides it to the lender.
Time Schedule for Information Collection
An institution generally must record data on each application and loan within 30 days
after the end of the calendar quarter during which the institution took final action. To comply
with statutory requirements, each covered lender must submit the completed LAR to the
applicable supervisory agency by March 1 of the year following the year covered by the LAR.
Institutions that submit incorrect information may be required to correct and resubmit the
information.
The FFIEC then prepares a disclosure statement from the data submitted by an institution
and provides it to the institution. Within three business days of receiving its statement, the
institution must make a copy available at its home office. In addition, within 10 business days of
receiving its statement, the institution must either: (1) make the statement available in at least
one branch office in every Metropolitan Statistical Area (MSA) and Metropolitan Division
(Division) where it has an office or (2) post a notice in at least one branch office per MSA and
Division where it has an office stating that the statement is available upon written request. If
requested, the lender need only provide the portion of data relating to the MSA or Division for
which the request is made. A lender must make each public disclosure statement available to the
public for five years.

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12 CFR 1003.1(b).

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Each institution must retain its completed LAR for three years and during that period it
must make its LAR available to the public after redacting certain information to protect the
privacy of its applicants and borrowers.
Justification
The FFIEC combines the HMDA/LAR data submitted by all reporting institutions and
produces aggregate data for each MSA; this information is publicly available.6 Supervisory
agencies, state and local public officials, and members of the public use data from the disclosure
statements produced by the FFIEC to aid in the enforcement of the Community Reinvestment
Act, the Equal Credit Opportunity Act, and the Fair Housing Act; to aid in identifying areas for
residential redevelopment and rehabilitation; and to evaluate the extent to which mortgage
lenders are serving local housing needs.
Legal Status
The Federal Reserve Board’s Legal Division has determined that section 304(j) of
HMDA, which requires the CFPB to prescribe by regulation the form of a LAR that must be
maintained by lending institutions, is mandatory for covered institutions. Regulation C
implements this statutory provision and requires that reports be sent to the appropriate federal
banking agency. HMDA requires that the LAR be made available to the public in the form
prescribed by the CFPB. The CFPB is authorized to require certain deletions from the LAR
information to protect the privacy of applicants and to protect depository institutions from
liability under Federal or state privacy law. The deleted information is exempt from disclosure
under that provision of HMDA and pursuant to Exemption 6 of the Freedom of Information Act.
Consultation Outside the Agency
On April 18, 2014 the Federal Reserve published a notice in the Federal Register (79 FR
21926) requesting public comment for 60 days on this proposal. The comment period for this
notice expired on June 17, 2014. The Federal Reserve did not receive any comments. A final
notice was published in the Federal Register on July 18, 2014 (79 FR 42010).
Sensitive Questions
Institutions must generally request that applicants for covered loans provide information
about their sex, race, and ethnicity. For applications taken in person, the institution must
generally infer the information based on visual observation and surname if an applicant declines
to provide the information. The purpose of collecting this information is to assist in identifying
possible discriminatory lending patterns and enforcing anti-discrimination statutes.

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The disclosure statements and aggregate data are produced by the Federal Reserve Board on behalf of the FFIEC.

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Estimate of Respondent Burden
In March 2013, 514 Federal Reserve-supervised banks submitted LARs identifying
334,024 loans and applications for 2012. Of those 514 banks, 345 had assets of less than $500
million and were responsible for 80,145 loan records received. In addition to the 514 banks, 17
Federal Reserve-supervised mortgage subsidiaries accounted for 133,126 loan records submitted
for 2012. Six of the mortgage subsidiaries had assets of less than $500 million and reported
7,615 records.
The reporting, recordkeeping, and disclosure burden for this information collection is
estimated to vary from 12 to 12,000 hours per respondent per year, with an average of 242 hours
for state member banks and an average of 192 hours for mortgage banking subsidiaries of state
member banks. This estimated burden includes time to gather and maintain the data needed,
review the instructions, and complete the register. The current total annual burden for entities
supervised by the Federal Reserve is estimated to be 127,652 hours. The reporting,
recordkeeping, and disclosure requirements represent less than 1 percent of total Federal Reserve
System paperwork burden.

State member banks
Mortgage subsidiaries of
state member banks

Number
of
respondents7

Estimated
annual
frequency

Estimated
average
hours per
response

Estimated
annual
burden hours

514

1

242

124,388

17

1

192

3,264
127,652

Total
The total annual cost to Federal Reserve respondents is estimated to be $6,497,487.8
Estimate of Cost to the Federal Reserve System

The total annual cost to the federal agencies responsible for this data collection is
estimated to be $3.1 million. The estimate includes, among other things, processing the
information generated by the collection, producing a disclosure statement for each institution,
and producing aggregate data for each MSA. This cost is allocated among the member agencies
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Respondents with less than $500 million in total assets: 345 SMBs and 6 mortgage subsidiaries. Small entities as
defined by the Small Business Administration:
www.sba.gov/contractingopportunities/officials/size/table/index.html.
8
Total cost to the public was estimated using the following formula: percent of staff time, multiplied by annual
burden hours, multiplied by hourly rates (30% Office & Administrative Support at $18, 45% Financial Managers at
$61, 15% Lawyers at $63, and 10% Chief Executives at $86). Hourly rate for each occupational group are the
(rounded) mean hourly wages from the Bureau of Labor and Statistics (BLS), Occupational Employment and Wages
2013, www.bls.gov/news.release/ocwage.nr0.htm Occupations are defined using the BLS Occupational
Classification System, www.bls.gov/soc/

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of the FFIEC and HUD based on the time spent by analysts and computers working on the data
relating to the respective agencies’ regulated institutions. The cost allocated to the Federal
Reserve is $522,073.

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