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A mother and son have applied jointly for a mortgage loan. Only the son will occupy the residence as his primary dwelling. Should the bank collect information for monitoring purposes on the mother since this will not be her primary residence?

My bank is not a Home Mortgage Disclosure Act (HMDA) reporter, but internal auditors are questioning whether the bank must collect information for monitoring purposes under Regulation B for the following loan. A mother and son have applied jointly for a mortgage loan. Only the son will occupy the residence as his primary dwelling. The mother resides elsewhere. Should the bank collect information for monitoring purposes on the mother since this will not be her primary residence?

Yes, the bank should collect information for monitoring purposes on all applicants. Regulation B’s §1002.13(a)(1) provides:

A creditor that receives an application for credit primarily for the purchase or refinancing of a dwelling occupied or to be occupied by the applicant as a principal residence, where the extension of credit will be secured by the dwelling, shall request…the [information for monitoring purposes] regarding the applicant(s)…

Though not explicit, the use of the singular in describing the type of loan (“occupied by the applicant… “) and the use of the potential plural in describing whose information is to be collected (“regarding the applicant(s)”) suggest that all applicants’ information should be collected if one applicant will occupy the dwelling as a principal residence. If the regulation were intended to be limited to only the applicant who will be occupying the dwelling, it would have read “regarding the applicant,” not “applicant(s).” (March 2019)

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