It’s been about a month and a half since the Section 1071 Final Rule was issued and we are continuing to dissect it. We’ve also had a lot of opportunities to speak with clients and get their first impressions of these requirements as well. One thing is certain, there are some requirements that will present a huge challenge and we’ve also started to see some common misconceptions along the way. Here are a few:
- If you are not currently a HMDA reporting bank, you MUST still understand the HMDA coverage rules. This will be a huge learning curve. The Rule states you are to report data for small business applications that are NOT also reportable for HMDA. It does not matter if your bank is subject to HMDA or not.
- What you “count” to determine if you’re covered by the Rule is different than what you will report under the Rule. For coverage purposes, you need to count your loan originations to small business borrowers. For reporting purposes, you need to report applications received from small business applicants.
- Agricultural loans ARE business loans and are therefore not exempt when determining coverage or reporting.
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Published
2023/05/11