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#1966984 - 10/03/14 06:56 PM 1 to 4 Family Rental Property
JLynch Offline
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Joined: Mar 2014
Posts: 21
When doing a loan for a borrower purchasing a 1 to 4 family rental property (business purpose loan) do you have to send out a GFE? This loan will be titled in an individuals name but the loan will be in the individual's name as well as a business name.

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#1967010 - 10/03/14 07:49 PM Re: 1 to 4 Family Rental Property JLynch
Cowboys Fan Offline
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Posts: 4,615
SC
If it's truly business purpose then no GFE.
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#1967015 - 10/03/14 08:05 PM Re: 1 to 4 Family Rental Property JLynch
JLynch Offline
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Joined: Mar 2014
Posts: 21
It is a 1-4 family being purchased by an individual for the purpose of renting it out.

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#1967222 - 10/06/14 06:41 PM Re: 1 to 4 Family Rental Property JLynch
Rocky P Offline
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Joined: Jun 2003
Posts: 7,650
Florida
From the commentary from reg Z.

1026.3(a)(1)4.
4. Non-owner-occupied rental property. Credit extended to acquire, improve, or maintain rental property (regardless of the number of housing units) that is not owner-occupied is deemed to be for business purposes. This includes, for example, the acquisition of a warehouse that will be leased or a single-family house that will be rented to another person to live in.

From RESPA Exemptions 1024.5(b)
(2) Business purpose loans. An extension of credit primarily for a business, commercial, or agricultural purpose, as defined by 12 CFR 1026.3(a)(1) of Regulation Z. Persons may rely on Regulation Z in determining whether the exemption applies.

So Z says exempt and therefore exempt from RESPA which means NO GFE

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