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#1586289 - 08/02/11 02:48 PM Loan Purpost
sunnyflowers Offline
100 Club
Joined: Feb 2009
Posts: 150
North Carolina
How would the following loan be classified?
Paying off 1st mtg on principal dwelling and will be advancing funds (like construction loan) for major renovations.......
Would this be a construction loan for home improvements OR a refinace for home improvement?
(Currently they have loan as a construction loan and I say it is a refi/hm imp which would make it subject to RESPA)
HELP! Thanks!

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Lending Compliance
#1586295 - 08/02/11 03:03 PM Re: Loan Purpost sunnyflowers
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 47,530
Bloomington, IN
I am making the assumption this loan is a temporary loan until the renovations are complete and then will be converted to a longer term permanent loan.

The temporary loan is not subject to RESPA nor HMDA reporting. The takeout loan will be the second phase and will be subject to RESPA and reported as a home improvement loan.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

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#1586296 - 08/02/11 03:00 PM Re: Loan Purpost Dan Persfull
sunnyflowers Offline
100 Club
Joined: Feb 2009
Posts: 150
North Carolina
Thank you so much! That clears this one up!

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