RESPA - Renewing & Extending Two Liens into One
Answer by Dan Persfull, BOL Guru Guru Bio
Question: We have a customer who has completed construction of his personal residence. He has a first and second lien. We are renewing and extending his two liens into one. Will RESPA apply for this transaction? Can we use his original disclosures or must we redisclose with the combined loan amount?
Answer: When you say you are renewing and extending the two liens into one, I have to assume you mean you are renewing and extending the two loans into one loan. If that assumption is correct, then in my opinion one of the loans is being satisfied and replaced with a new loan thus meeting the definition of a refinancing and requiring all new disclosures.
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