Summary of 2021 Data on Mortgage Lending
This summary provides information about the data on 2021 mortgage lending transactions at 4,338 U.S. financial institutions reported under the Home Mortgage Disclosure Act (HMDA). Covered institutions include banks, savings associations, credit unions, and mortgage companies.
The HMDA data are the most comprehensive publicly available information on mortgage market activity. They are used by industry, consumer groups, regulators, and others to assess potential fair lending risks and for other purposes.
Understanding the Data
The data include a total of 48 data points providing information about the applicants, the property securing the loan or proposed to secure the loan in the case of non-originated applications, the transaction, and identifiers. A complete list of HMDA data points and the associated data fields is found in the FFIEC’s Filing Instructions Guide for HMDA Data Collected in 2021 . Certain smaller-volume financial institutions are not required to report all of these data, pursuant to the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA).1
The 2021 HMDA data use the census tract delineations, population, and housing characteristic data from the 2011–2015 American Community Survey (ACS). In addition, the data reflect metropolitan statistical area (MSA) definitions released by the Office of Management and Budget in 2020 that became effective for HMDA purposes in 2021.
Among other uses, the data help the public assess how financial institutions are serving the housing needs of their local communities and facilitate federal financial regulators’ fair lending, consumer compliance, and Community Reinvestment Act examinations. For example, when these regulators evaluate an institution’s fair lending risk, they analyze HMDA data in conjunction with other information and risk factors, in accordance with the Interagency Fair Lending Examination Procedures .
HMDA data are generally not used alone to determine whether a lender is complying with fair lending laws. The data do not include some legitimate credit risk considerations for loan approval and loan pricing decisions. Therefore, when regulators conduct fair lending examinations, they analyze additional information before reaching a determination about an institution’s compliance with fair lending laws.
Observations from the 2021 Data2
For 2021, the number of reporting institutions declined by about 3.1 percent from the previous year to 4,338.
The 2021 data include information on 23.3 million home loan applications. Among them, 21.1 million were closed-end, 1.8 million were open-end, and, for another 350,000 records, pursuant to the EGRRCPA’s partial exemptions, financial institutions did not indicate whether the records were closed-end or open-end. The number of closed-end loan applications increased by 3.6 percent, and the number of open-end line of credit applications increased by 7.0 percent. A total of 15.0 million applications resulted in loan originations. Among them, 13.7 million were closed-end mortgage originations, 1.0 million were open-end line of credit originations, and, pursuant to the EGRRCPA’s partial exemptions, 268,000 were originations for which financial institutions did not indicate whether they were closed-end or open-end. The 2021 data include 2.7 million purchased loans, for a total of 26.1 million records. The total also includes information on approximately 148,000 preapproval requests that were denied or approved but not accepted.
The total number of originated closed-end loans increased by about 528,000 between 2020 and 2021, or 4.0 percent.3 Closed-end refinance originations for 1-4 family properties decreased by 1.4 percent from 8.5 million, and closed-end, 1-4 family home purchase lending increased by 9.2 percent from 4.8 million.4
A total of 1,365 reporters made use of the EGRRCPA’s partial exemptions for at least one of the 26 data points eligible for the exemptions. In all, they account for about 380,000 records and 277,000 originations.
From 2020 to 2021, the share of closed-end home purchase loans for first lien, 1-4 family, site-built, owner-occupied properties made to low- or moderate-income borrowers (those with income of less than 80 percent of area median income) decreased slightly from 30.4 percent to 28.7 percent, and the share of closed-end refinance loans to low- and moderate-income borrowers for first lien, 1-4 family, site-built, owner-occupied properties increased from 18.9 percent to 24.0 percent.
In terms of borrower race and ethnicity, the share of closed-end home purchase loans for first lien, 1-4 family, site-built, owner-occupied properties made to Black borrowers rose from 7.3 percent in 2020 to 7.9 percent in 2021, the share made to Hispanic-White borrowers increased slightly from 9.1 percent to 9.2 percent, and those made to Asian borrowers increased from 5.5 percent to 7.1 percent. From 2020 to 2021, the share of closed-end refinance loans for first lien, 1-4 family, site-built, owner-occupied properties made to Black borrowers increased from 4.2 percent to 5.4 percent, the share made to Hispanic-White borrowers increased from 5.3 percent to 6.1 percent, and the share made to Asian borrowers decreased from 6.7 percent to 6.0 percent.
In 2021, Black and Hispanic-White applicants experienced denial rates for first lien, 1-4 family, site-built, owner-occupied conventional, closed-end home purchase loans of 15.7 percent and 9.8 percent respectively, while the denial rates for Asian and non-Hispanic-White applicants were 7.5 and 5.6 respectively. These relationships are similar to those found in earlier years and, due to the limitations of the HMDA data mentioned above, cannot take into account all legitimate credit risk considerations for loan approval and loan pricing.
The Federal Housing Administration (FHA)-insured share of closed-end first-lien home purchase loans for 1-4 family, site-built, owner-occupied properties decreased slightly from 19.4 percent in 2020 to 17.2 percent in 2021. The Department of Veterans Affairs (VA)-guaranteed share of such loans decreased slightly to 9.7 percent in 2021. The overall government-backed share of such home purchase loans, including FHA, VA, Rural Housing Service, and Farm Service Agency loans, was 29.3 percent in 2021, down from 32.8 percent in 2020.
The FHA-insured share of closed-end refinance mortgages for first lien, 1-4 family, site-built, owner-occupied properties increased to 6.9 percent in 2021 from 6.2 percent in 2020, while the VA-guaranteed share of such refinance loans decreased from 11.9 percent in 2020 to 10.2 percent in 2021.
The share of mortgages originated by non-depository, independent mortgage companies has increased in recent years. In 2021, this group of lenders accounted for 63.9 percent of first lien, 1-4 family, site-built, owner-occupied, closed-end home-purchase loans, up from 60.7 percent in 2020. Independent mortgage companies also originated 65.7 percent of first lien, 1-4 family, site-built, owner-occupied, closed-end refinance loans, an increase from 63.1 percent in 2020.
The HMDA data also identify loans that are covered by the Home Ownership and Equity Protection Act (HOEPA). Under HOEPA, certain types of mortgage loans that have interest rates or total points and fees above specified levels are subject to certain requirements, such as additional disclosures to consumers, and also are subject to various restrictions on loan terms. For 2021, 6,518 loan originations covered by HOEPA were reported: 3,314 home purchase loans for 1-4 family properties; 393 home improvement loans for 1-4 family properties; and 2,811 refinance loans for 1-4 family properties.
1. See Public Law 115–174, 132 Stat. 1296 (2018); Final Rule, Official Interpretation, Home Mortgage Disclosure Act (Regulation C), 84 FR 57946 (Oct. 29, 2019).
2. A May 3, 2021 dataset used to develop the observations in this statement about the 2020 HMDA data is available here. Analysis of data downloaded from the HMDA Platform at a later date may not yield precisely the same conclusions provided here, given that data available from the HMDA Platform will be updated, on an ongoing basis, to reflect resubmissions and late submissions. For historical and more detailed data derived from the annual HMDA records, see https://www.consumerfinance.gov/data-research/hmda/.
3. The data used in these comparisons is taken from the 2020 Snapshot National Loan-Level Dataset .
4. For purposes of these 2020 and 2021 comparisons, the 2021 data on open-end lines of credit and “other purpose” loans are excluded.