HMDA and UAD Data Released Last Week
Written By: Joel Palmer, Op-Ed Writer
Mortgage underwriters and processors who are interested can keep themselves busy for a while studying a pair of recently released sets of data.
The Federal Financial Institutions Examination Council (FFIEC) released data on 2022 mortgage lending transactions reported under the Home Mortgage Disclosure Act (HMDA). The data was compiled from records by 4,460 U.S. financial institutions, including banks, savings associations, credit unions, and mortgage companies.
The 2022 data include information on 14.3 million home loan applications. Among them, 11.5 million were closed-end and 2.5 million were open-end. Another 287,000 records are from financial institutions making use of Economic Growth, Regulatory Relief, and Consumer Protection Act’s partial exemptions and did not indicate whether the records were closed-end or open-end.
One of the interesting facts from the data release was a slight decrease in the share of non-depository mortgage issuances in 2022. Those institutions accounted for 60.2 percent of loans, down from 63.9 percent in 2021.
The data also included borrower race and ethnicity data. The share of closed-end home purchase loans made to Black or African American borrowers rose from 7.9 percent in 2021 to 8.1 percent in 2022. The share made to Hispanic-White borrowers decreased slightly from 9.2 percent to 9.1 percent. Those made to Asian borrowers increased from 7.1 percent to 7.6 percent.
In 2022, Black or African American and Hispanic-White applicants experienced denial rates for home purchase loans of 16.4 percent and 11.1 percent respectively, while the denial rates for Asian and non-Hispanic-White applicants were 9.2 percent and 5.8 percent respectively.
Also published last week was the Federal Housing Finance Agency’s (FHFA) 2023 first quarter data for the Uniform Appraisal Dataset (UAD) Aggregate Statistics.
For the first time, FHFA's UAD Aggregate Statistics include data on residential property sales comparisons ("comparables"). FHFA said these data can provide vital quantitative insights into the appraisal process, as comparables are a leading method used to assess property values. The UAD Aggregate Statistics also have been updated with new property characteristics, including:
Lot size categories
Property condition ratings
Presence of an accessory dwelling unit
Largest race/ethnicity group in a tract
"Today's release significantly increases the number of individual statistics FHFA had previously made available to the public," said FHFA Director Sandra L. Thompson. "The new and updated data further demonstrate our commitment to transparency and to providing access to information that can help deter appraisal bias.”
FHFA added two dashboards that present census tract data and appraisal gap statistics. The Census Tracts Dashboard allows the public to more easily explore data at the census tract level, which had previously only been accessible to users with advanced statistical software. The Appraisal Gap Dashboard highlights disparities in the proportion of borrowers whose property had an appraised value below the contract price.
Among the top 100 metro areas in the U.S., El Paso, Texas experienced the largest year-over-year increase in appraised values. Single-family homes in this area had a 12.6 percent increase in median appraised value, from $230,000 to $259,000 over the past year.
Of the top 100 metropolitan areas, 44 experienced declines in year-over-year appraised values. The largest decline was in Boise City, Idaho, which had a 16.3 percent decrease, from a median appraised value of $526,000 in the first quarter of 2022 to $440,000 in the first quarter of this year.
The UAD is a standardized industry dataset for appraisal information that Fannie Mae and Freddie Mac receive electronically through the Uniform Collateral Data Portal. The enterprises, at the direction of the FHFA, developed the first UAD in 2010.
About the Author
As an NAMU® Opinion Editorial Contributor, Joel Palmer is a freelance writer who spent 10 years as a business and financial reporter and another 10 years in marketing for the insurance and financial services industries. He regularly writes about the mortgage industry, as well as residential and commercial real estate, investments, and retirement income planning. He has also ghostwritten books on starting a business, marketing, and retirement income planning.
