We are making a loan on 130 acres. There is an old home on the property that is deemed to add no value (all value in the land). We are making it as a land loan and the appraised value is done simply on the value of the land. Because there is a SFR on the property is it a home purchase and thus HMDA reportbale? Thank You for any help.

Yes it is. It should be reported on HMDA.

I can't put my finger on it right now, but I seem to recall that for HMDA purposes, land of 25 acres (I think) or more is considered farmland and is not HMDA reportable, even if there is a dwelling on the land. Anyone else aware of that?

I'm not so sure that it is a reportable loan. How will the land be used?

If the primary use of this property is not dwelling related, in fact what you have said leads me to believe that the dwelling may not even be habitable, it would not be reported. See Getting It Right, D-5 & D-6.

Lee, see GIR, D-6 addresses farmland.

I went to a HMDA seminar, and my training manual states "A loan to purchase property used primarily for agricultural purposes is not a home purchase loan, even if the property includes a dwelling. Any reasonable standard may be used to determine the primary use of the property, such as by reference to the exemption in the RESPA for a loan on property of 25 acres or more. The institution may select the standard to apply on a case-by-cae basis."

So I would say it is NOT HMDA reportable.

I'm confused. The original poster didn't say this was agricultural land. How do we know it isn't used for some other purpose? We have customers who purchase land for hunting. Even though in these cases the value of the land is generally what we rely on in making the credit decision, if there is some type of dwelling on the property that they stay at while hunting, we report these as vacation homes.

Nawna and hmdagal are both right. IF this is a "farm loan", then it is exempt from HMDA. But if it is hunting ground you can make the argument that it isn't a farm loan.

However, I want to go back to the original question. It states: "There is an old home on the property that is deemed to add no value (all value in the land). "
If the house has no value then I'm going to assume that it is not inhabitable. If it is not inhabitable, then the "house" is NOT a dwelling - it is a shack. Soooo, HMDA doesn't apply.

I would also think that if the borrower has a stated intention of demolishing the structure, then you have evidence that the dwelling is not intended for habitation.

I had a loan to purchase an old apartment building where the intention was to demolish the building a build a parking lot for the the commercial building next door. The customer had the permits, the appraisal was done for value on the use of the vacant land, etc.

I sent my question to HMDA help to ask if this was HMDA reportable. Their response was if the loan file contains documentation from the customer of their intention to demolish the building, then it is not HMDA reportable.

And if you think about it, the answer makes sense. What's the point of putting something on the LAR if it won't exist by the time the Aggregated Disclosure is published?

I posted the original question and then have been out of town at a very thrilling "Deposit Compliance" seminar, whoo whooo! Anyway, in our situation the borrower plans on someday (in the distant future and not with the loan funds) building a SFR to live in a enjoy his secluded 130 acres. The house on the land now is not going to be demolished but was deemed by the appraiser to add no significant value to property (again the value is in the land, if the house did not exist the property value would not chnage). I am not sure if it is inhabitable. Maybe that is the $53 billion dollar question? Any thoughts?