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Is HOEPA Applicable to Bridge Loans?
by Dan Persfull, BOL Guru
Guru Bios
Question: Does HOEPA apply to bridge loans?
Here are three scenarios:
- Purchase new primary residence, secured by that residence.
- Purchase new primary residence, secured by current primary residence.
- Purchase new primary residence, secured by both the current and new residences.
Answer: The only loans exempt from HOEPA are: (226.32(a)(2))
- Residential Mortgage Transactions (the definition can be found in 226.2)
- Reverse mortgages subject to 226.33
- Open-end credit plans subject to Subpart B of Reg. Z
Therefore, taking the time to read the exemptions and the definitions the answers would be (assuming they are not reverse mortgages or an open-end credit plan):
- No.
- Yes.
- Yes.
First published on BankersOnline.com 11/21/2005
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