FFIEC Rate Spread Calculator

About the Rate Spread Calculator

The FFIEC has developed the Rate Spread Calculator to assist HMDA reporting institutions with the new Regulation C requirements for reporting Rate Spread data effective for 2004 HMDA data and forward. The Rate Spread Calculator generates the spread between the Annual Percentage Rate (APR) and the comparable treasury security utilizing the "Treasury Securities of Comparable Maturity under Regulation C" table, action taken, lock-in date, APR, term (loan maturity), and lien status. The rate spread is the spread between the APR on a loan and the rate on Treasury securities with comparable maturity periods for loan originations in which the APR exceeds the applicable rate by a percentage specified by the Board. The reporting requirement applies to originations of: home purchase loans, dwelling-secured home improvement loans, and refinancings.

• "Treasury Securities of Comparable Maturity Under Regulation C" Table
• Using the Single Rate Spread Calculator
• Using the Batch Rate Spread Calculator
• Data Requirements for the Rate Spread Calculator
• Rate Spread Equal to 'NA'
• Frequently Asked Questions (FAQs)
• Contact HMDA Processing Staff

"Treasury Securities of Comparable Maturity Under Regulation C" Table

The "Treasury Securities of Comparable Maturity Under Regulation C" table is provided by the FFIEC for use in calculating the rate spread data on HMDA reportable loans effective for 2004 HMDA data and forward. The Treasury securities table is available in ASCII comma delimited format to view, print or download.

The update to the Treasury Securities of Comparable Maturity Under Regulation C table (Treasury securities table) is performed within 24 hours of the Federal Reserve posting the relevant H.15 statistical release. Posting of the statistical release by the Federal Reserve for the 15th of the month typically occurs in the evening on the next business day following the 15th of the month. Due to the delay in the release of the statistical data necessary to update the Treasury securities table, the rate spread cannot be calculated until the table has been updated. This delay will occur every month and should be considered when attempting to calculate the rate spread between the 15th and 17th of the month.  

There will be NO revisions to the Treasury securities table unless there is an error in a yield that is listed on the Treasury securities table when compared with the H.15 statistical release. If a revision to the Treasury securities table is necessary based on inaccurate information, a footnote will be placed on the FFIEC Rate Spread web site noting the date, time and nature of the update.  

The Treasury securities table posted on this web site is the sole source of Treasury yield data for calculating the rate spread for HMDA reporting purposes. Regulation C requires institutions to use only the "Treasury Securities of Comparable Maturity under Regulation C" Table posted on this web site, therefore, use of the H.15 or any data source other than the Treasury securities table will result in an invalid rate spread calculation that will NOT be accepted by your regulator.

Using the Single Rate Spread Calculator

Step 1

From the main FFIEC Rate Spread Calculator page, enter the following information from the loan application documents:

• Lock-In Date
• APR
• Term
• Lien Status

(see 'Data Requirements for the Rate Spread Calculator' for more information on data thresholds)

If the data entered contains errors or does not meet the required file specifications, an error message to the right of the field will notify the user after choosing 'Submit'.  The data must be corrected to calculate a valid rate spread.  

Step 2

Click "Submit" to calculate the rate spread for the loan application data entered.  

Step 3

The rate spread will be calculated and provided on the front page in percentage-point format, four numerical characters and the decimal point or 'NA' if appropriate. The calculated rate spread should be entered on the HMDA LAR, including all leading and trailing zeros. For example, a calculated rate spread of 3.5 percentage points should be entered on the HMDA LAR as 03.50. A rate spread equal to 'NA' should be entered as 'NA', left justified.

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Using the Batch Rate Spread Calculator

Step 1

From the main FFIEC Rate Spread Calculator page, choose the "Batch Rate Spread Calculator" link from within the main paragraph.

Step 2

Enter the following information from the loan application documents for a maximum of 10 loans at one time:

• Lock-In Date
• APR
• Term
• Lien Status

(see 'Data Requirements for the Rate Spread Calculator' for more information on data thresholds)

If the data entered contains errors or does not meet the required file specifications, an error message below the field will notify the user after clicking the "Submit" button.

Step 3

Click "Submit" to calculate the rate spread for the loan application data entered.

The rate spread will not be calculated for data containing errors in formatting or data that do not meet the file specifications. The data must be corrected and the user must "Submit" the data again to receive a valid rate spread.

Step 4

The rate spread will be calculated and provided in the Rate Spread box following Lien Status. The rate spread will be provided in percentage-point format, four numerical characters and the decimal point or 'NA' if appropriate. The calculated rate spread for each Record ID should be entered on the HMDA LAR, including all leading and trailing zeros. For example, a calculated rate spread of 3.5 percentage points should be entered on the HMDA LAR as 03.50. A rate spread equal to 'NA' should be entered as 'NA', left justified.

Data Requirements for the Rate Spread Calculator

The yield calculator requires several components to successfully generate a rate spread for HMDA reporting. The required data include the action taken (provided), lock-in date, annual percentage rate, maturity and lien status.

• Action Taken
   
  • The Rate Spread is reported on originated loans only, therefore, any action on the application or loan, other than an origination (Action Taken = 1), will result in a rate spread equal to 'NA'. 'NA' should be entered in the rate spread field on the LAR reporting form for any action other than an origination.
  
  
• Lock-In Date
   
  • The date of the Treasury yield used in the adjustment of the APR is the 15th-of-the-month before the date on which the loan's interest rate was set by the financial institution for the final time before closing. If an interest rate is set pursuant to a "lock-in" agreement between the lender and the borrower, then the date on which the agreement fixes the interest rate is the date the rate was set. If a rate is re-set after a lock-in agreement is executed (for example, because the borrower exercises a float-down option or the agreement expires), then the relevant date is the date the rate is re-set for the final time before closing. If no lock-in agreement is executed, then the relevant date is the date on which the institution sets the rate for the final time before closing.
     
  • The lock-in date should be in mm/dd/ccyy format. The lock-in date cannot be earlier than 12/16/1997 or later than the 14th of the month after the last month published on the "Treasury Securities of Comparable Maturity under Regulation C" table.
  
  
• Annual Percentage Rate (APR)
   
  • APR should be entered in percentage format and data entered should be in the range 00.00 to 99.99%. For example, an APR of 4.875% should be entered 04.88, including all leading and trailing zeros. If the figure is more than two decimal places, round the figure or truncate the digits beyond two decimal places.
  
  
• Maturity
   
  • The loan maturity, also referred to as the loan term, should be entered in years using whole numbers between 1 and 40. Terms consisting of a whole number of years and a fraction of a year should be rounded to a whole number according to the following rule: a fractional year less than .5 should be rounded to the lower term, and a fractional year of .5 or greater should be rounded to the higher term. There is an exception for a loan term shorter than six months, which should be rounded to 1.
     
  • If the amortization period of a loan is longer than the term of the loan – i.e., because the loan has a balloon feature- the lender should use the term when selecting the comparable Treasury yield. For example, in the case of a five-year loan that has a balloon payment because the payments are amortized over 30 years, the term of five years must be used.
     
  • In an Adjustable Rate Mortgage (ARM) situation, it is a long-term loan that happens to have a feature whereby the rate adjusts at a much earlier time -- for example, five years. The lender should use the term when selecting the comparable Treasury yield. The term represents the time to maturity on a loan product. For example, a 5/30 ARM that is amortized over 30 years should use 30 as the loan term, because the time to maturity in this example is 30 years.
     
  • If an obligation is payable on demand, the creditor shall make the disclosures based on an assumed maturity of 1 year. If an alternate maturity length is stated in the legal obligation between the parties, the maturity shall be based on that length.
  
  
• Lien Status
   
  • Lenders are required to report lien status for loans they originate and applications that do not result in an origination. Lien status is determined by reference to the best information readily available to the lender at the time final action is taken and to the lender's own procedures.
     
  • Indicate the lien status for loans that you originate and for applications that do not result in an origination by using one of the following codes:
    • 1- Secured by a first lien
    • 2- Secured by a subordinate lien
    • 3- Not secured by a lien
    • 4- Not applicable (purchased loan)
    
     
  • If the lien status is equal to 1 and the rate spread calculated is less than 3 percentage points, the result will be a rate spread equal to 'NA'. If the lien status is equal to 2 and the rate spread calculated is less than 5 percentage points, the result will be a rate spread equal to 'NA'.
     
  • If the lien status is equal to 1 or 2 and the rate spread calculated is equal to or greater than 99.99%, the result will be a rate spread equal to 99.99%.
     
  • If the lien status is equal to 3, not secured by a lien, the result will be a rate spread equal to 'NA'.
     
  • The lien status code of 4 is used to identify purchased loans on the LAR reporting form. The rate spread is NOT calculated for purchased loans and will therefore result in a rate spread equal to 'NA'.

Rate Spread Equal to 'NA'

A rate spread equal to 'NA' is a result of one or more data parameters that do not meet the specifications for reporting the rate spread. Data parameters that will result in a rate spread equal to 'NA' are listed below.

• The Rate Spread is reported on originated loans only, therefore, any action on the application or loan, other than an origination (Action Taken = 1) will result in a rate spread equal to 'NA'.

• If the loan is not subject to Regulation Z, or is a home improvement loan that is not dwelling-secured, or is a loan that you purchased, enter 'NA'.

• If the lien status equals 1 and the rate spread calculated is less than 3 percentage points, the result will be a rate spread equal to 'NA'.  If the lien status equals 2 and the rate spread calculated is less than 5 percentage points, the result will be a rate spread equal to 'NA'.

• If the lien status equals 3, not secured by a lien, the result will be a rate spread equal to 'NA'.

• The lien status code of 4 is used to identify purchased loans on the LAR reporting form.  The rate spread is NOT calculated for purchased loans and will therefore result in a rate spread equal to 'NA'.

• The rate spread is not calculated on Home Equity Lines of Credit (HELOCs). If the institution chooses to report HELOCs, the rate spread should be equal to 'NA'.

Frequently Asked Questions (FAQs)

• Rate Spread versus HOEPA, what is the difference?
   
  • Rate Spread is a calculated field and is NOT simply the APR on the loan application. Rate Spread and HOEPA are two separate fields on the HMDA LAR with two separate calculations. The rate spread web site should be used only for calculating the rate spread.
     
  • HOEPA covers closed-end loans secured by the borrower’s principal residence, other than home purchase loans, WITH RATES OR FEES ABOVE CERTAIN THRESHOLDS OR "TRIGGERS". HOEPA has an APR trigger and a points and fees trigger. For HOEPA calculation information, refer to the following link ( http://www.stlouisfed.org/hmdaregcamendments/pages/hoepa_status.html). This page discusses the HOEPA calculation requirements to determine if the originated or purchased closed-end loans secured by the borrower’s principal residence are HOEPA loans.

• The date is after the 15th of the month but the table does not seem to have been updated. How do I view/update my Treasury securities table to reflect the most current rates?
   
  • If the date is after the 15th of the month and you cannot view or download the most current rates, you may have to clear the "cache" on your web browser.
    
    
    • For example, Internet Explorer users should press the Refresh button or use the menu options View, Refresh while holding down the "Ctrl" key on your keyboard. This will refresh the current web page stored in your cache with the latest content on the web page.
      
      
    • If Refresh fails to display the updated page, you can clear your Internet Explorer cache by following the appropriate procedure below. This will delete all the files that are currently stored in your cache.
      
      
      • For Internet Explorer version 4.0:
        
        
        • On the View menu of your Internet Explorer toolbar, click Internet Options.
          
          
        • Click the General tab.
          
          
        • In the Temporary Internet files area, click Delete Files, then click OK.
          
          
        • Click OK to close Internet Options.
          
          
      • For Internet Explorer version 5.0, 5.5, 6.0:
        
        
        • On the Tools menu of your Internet Explorer toolbar, click Internet Options.
          
          
        • Click the General tab.
          
          
        • In the Temporary Internet files area, click Delete Files, then click OK.
          
          
        • Click OK to close Internet Options.
          
          
    • If the above tasks do not correct your problem, please contact your Network Administrator for assistance or call the HMDA technical assistance line at 202-452-2016.

• When I submitted my data for calculation I received the message "Invalid Parameters", what does this mean?
   
  • Data elements entered into the Lock-In Date, APR, Term and/or Lien Status field do not meet the requirements for that field. If this is the case, a red text error message will appear to the right of the field indicating the error.
    
    OR
    
    
  • The update to the Treasury Securities of Comparable Maturity Under Regulation C table (Treasury securities table) is performed within 24 hours of the Federal Reserve posting the relevant H.15 statistical release. Posting of the statistical release by the Federal Reserve for the 15th of the month typically occurs in the evening on the next business day following the 15th of the month. Due to the delay in the release of the statistical data necessary to update the Treasury securities table, the rate spread cannot be calculated until the table has been updated. This delay will occur every month and should be considered when attempting to calculate the rate spread between the 15th and 17th of the month.

• What term should be used when the amortization period is longer then the term?
   
  • If the amortization period of a loan is longer than the term of the loan – i.e., because the loan has a balloon feature- the lender should use the term when selecting the comparable Treasury yield. For example, in the case of a five-year loan that has a balloon payment because the payments are amortized over 30 years, the term of five years must be used.
     
  • In an Adjustable Rate Mortgage (ARM) situation, it is a long-term loan that happens to have a feature whereby the rate adjusts at a much earlier time -- for example, five years. The lender should use the term when selecting the comparable Treasury yield. The term represents the time to maturity on a loan product. For example, a 5/30 ARM that is amortized over 30 years must use 30 as the loan term, because the time to maturity in this example is 30 years.

• Do I need to manually locate the yield on the Treasury securities table to use the single or batch rate spread calculator?
   
  • No. When utilizing the single or batch rate spread calculator, the user does not need to manually determine the applicable yield. The single and batch rate spread calculator utilize the lock-in date, APR, term, and lien status entered by the user to determine the applicable yield for the rate spread calculation.
     
  • An institution will use the download and save feature of the Treasury securities table when utilizing the FFIEC HMDA Data Entry Software (HMDA DES), the Batch Rate Spread Calculator (HMDA DES- External Component), or an in-house rate spread calculation program. After successfully downloading the Treasury securities table, the institution can Import the table into the HMDA software for rate spread calculations. The Treasury securities table must be downloaded each month to ensure the applicable yields are being utilized for the rate spread calculation.

• How do I use the "Treasury Securities of Comparable Maturity under Regulation C" Table using the ASCII comma delimited text file format?
   
  • Microsoft Excel
     
    • The ASCII comma delimited text file format allows the Treasury securities table to be easily retrieved into a variety of applications, but is best viewed within one that will allow the user to easily manipulate data that is in columnar format. Microsoft Excel is an example of such an application. If you have Microsoft Excel installed on your computer, the Treasury securities table will open in Microsoft Excel by default.
       
    • Column 'A' represents the 'Treasury Securities Yield Date'. Columns 'B' through 'AO' represent the loan maturity (term).
       
    • To find the relevant yield, identify the relevant date (the 15th-of-the-month before the date the interest rate was set for the final time) in the left-hand column, Column 'A', and navigate across the row until the yield corresponding to the term of the loan has been reached. Loan terms are arrayed across the top, in Columns 'B' through 'AO'.
       
  • Text-Editing/ Word-Processing Application
     
    • If you don't have access to a spreadsheet application such as Microsoft Excel, you can also retrieve the Treasury securities table in an ASCII text-editing or word-processing application. However, these two application types cannot easily format the width of the data columns and will require a significant amount of manual reformatting to properly view the data.
       

• When I view or print the ASCII comma delimited file using Microsoft Excel, some of the fields in Column 'A' show '#####'. What do I do?
   
  • When viewing the Treasury securities table in ASCII comma delimited format using Microsoft Excel and the table shows the following characters in column A, "#####", the user must extend the width of the column. To extend the width of the column, complete the following steps;
     
    • Select any cell in column 'A'.
    • Choose 'Format' on the top menu bar
    • Choose 'Column'
    • Choose 'Width'
    • Set 'Width' to 18.

• Can I download the Rate Spread Calculator?
   
  • No. The FFIEC HMDA rate spread web site does not offer the capability to download the rate spread calculator. The HMDA Data Entry Software provides installation capability for the rate spread calculator as a separate component of the software.

• Can I import my loan application information into the rate spread calculator to retrieve a rate spread?
   
  • No. The FFIEC HMDA rate spread calculator does not offer the capability to import loan application data. The HMDA Data Entry Software rate spread "external component" provides 'import' capability provided the loan application data meet the file specifications provided in the software Help files.

If these facts do not address your specific questions, please contact HMDA processing staff.

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Contact HMDA Processing Staff

HMDA Reporting Questions

If you have a question regarding the rate spread calculator, HMDA reporting or cannot locate a particular item of interest, please contact the HMDA Assistance Line at 202-452-2016 or send an e-mail to HMDAHELP.

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