I'm sure some of you have experienced this situation, but it is unique to me.

We are taking a mobile home and land (unattached) as collateral on a new loan. The mobile home is the customer's primary residence and is currently financed by another bank. The mobile home sits on the land and it is under a lease/purchase contract from the previous owner. The funds needed to pay off both are about equal.

Should the customer receive the right to rescend (refi of primary residence) or is it exempt (purchse of land)? I'm pretty sure I know the answer, but I'd love to hear your thoughts.

This does not meet the difinition of a Residential Mortgage Transaction (the borrower already owns the primary residence). The ROR applies.

My thoughts exactly, but it is always good to get a second opinion. Thanks Dan!

I agree also, and you are wise to take both the mobile home and the land. I have seen cases where the bank only took the mobile home and then when they tried to foreclose and repossess, they ran into "homestead" and "access" problems.

Since we're on the recission theme, I'd like to ask a strange question. Is it ok for both borrowers with the right to rescind to sign the SAME notice noting that they got their copies? For some reason, our processing staff seem to think that one borrower has to sign one copy and the other borrower has to sign a 2nd copy (both of which are kept in the file). This seems silly to me, but maybe I'm missing something. What do you think?

Each borrower must receive two copies of the ROR. There is nothing in Regulation Z that requires a signature acknowledging receipt, but that is one way to "prove" your compliance with the requirement. It is your choice whether to get a signature or not. If you get signatures, make sure that the signatures "prove" that each person that has the right to rescind received two copies of the notice.

Jack, the signatures are attesting that each person got duplicate copies of the form, however, in my opinion, that doesn't prove anything. It looks good for examiners, but you could never prove that they each got their two copies. My audit is proving that our personnel needs training on how many copies are to be given. Getting them to change could be interesting since the customer is going ahead and attesting to something they may or may not be getting enough copies of.

One other issue to note on a Mobile Home "refi" if you are not also taking real estate as collateral:

The 4(c)7 charges that are normally not finance charges? Well, they BECOME finance charges because they can only be excluded in an RMT or if the loan is secured by real estate.

Yeah....found that one out the hard way a while back. If you do any Mobile Home financing, you'll want to make a chart of the differences in your procedures.

Thanks for the tip Bonnie! We rarely finance MHs, but we recently opened an office in a rural area. I have a feeling that we will be doing more in the future. I guess I'll be proactive and work something up for those. Ahhhh, a Compliance Officer's work is never done.