Age Limit for LARs?
Where in the trusty FFIEC's "Guide to HMDA Reporting: Getting it Right!" does it mention LARs with app. dates greater than 5 years of the action date? Is there a limit on how old a LAR can be? The few apps. with this issue have not previously been reported or given a final dispostion until now. Comply users: I'm getting a V380 for a few previously not reported apps. Thank you all in advance.
I found this in the 2004/2005 booklet under Data Reporting in General A LAR for a given calendar year must contain all reportable applications that reached final action (e.g., origination of a loan, denial of an application) in that year, regardless in which year the application was submitted. The LAR should exclude applications that have not yet reached a final action; those applications should appear on the LAR for the calendar year in which they reach final action.
In answer to your question regarding loans appearing on the LAR with application dates greater than 5 years old. The information that you're looking for is in the 2005 System Edit document, the reason that you're not finding it in HMDA Getting It Right or the actual regulation is it is specifically a system edit. This is something that I use to run into at my prior shop. The Validity Error V380 is probably the only validity error that I know of that can be on the LAR when you submit to the regulators. I use to run into the problem with construction / perm loans that were caught up in the legal system for one reason or another, i.e. non performance by the builder, divorce of the purchasers. We would have underwritten the loan as a single close construction / perm loan and by the time we were closing on the perm portion of the loan the application date had exceeded the new limitations and hence would cause a V380 error. The only thing that I use to do is address the validity error in my cover letter to the regulator when submitting my submission file. Mind you I would also get an error report from the regulator and have to explain that the application date was correct.
Basically the V380 edit should be a Quality Edit, but the FFIEC realizes that institutions sometimes take the Quality Edits too lightly. Since this is a situation that should be verified, they have kept it a Validity Edit. But as Bob mentioned, it is an incurable edit. This is one of the few situations where it is actually OK to submit with this edit, however, you will be questioned again no matter how much you preface it. Good question! jaw