This federal law requires the collection of certain data on application forms, though this information may not be considered when making a credit decision.

• A. The Home Mortgage Disclosure Act - HMDA
• B. The Fair Credit Reporting Act - FCRA
• C. The Truth in Lending Act - TILA
• D. The Equal Credit Opportunity Act - ECOA

Answer: (A)

The data-collection requirement on mortgage applications comes from a federal law that tracks lending patterns and helps enforce fair lending practices. This law is the Home Mortgage Disclosure Act. It requires lenders to collect and report certain information on application forms and loan originations, including borrower demographics and loan details, so regulators and the public can analyze patterns by geography and lender. Importantly, this information is not used to determine whether to approve a loan; its purpose is to monitor for possible discrimination and to analyze access to credit across communities. The other laws govern different areas: one focuses on the accuracy and use of consumer credit reports; another requires clear disclosures of loan terms and costs; and another prohibits discriminatory practices in lending without mandating this specific data collection. Understanding HMDA helps explain why lenders collect demographic data on applications even though those data should not influence the credit decision.