Two years ago we granted a new loan and took a first mortgage on a piece of vacant land as collateral. The loan is now going through a renewal. While completing the evaluation, we learned that the borrower; using his own cash, built a home on the property that’s encumbered. The way our mortgage reads, we have interest in ... all existing or subsequently erected or affixed buildings, improvements, and fixtures...
When we complete the valuation report, should the value of the home be included in the report and furthermore, if so, should the report be mailed to the borrower under Regulation B?
How does HMDA define a "complete" and "incomplete" loan application?
Exceptions that compliance officers monitor?
For 2017 HMDA rules, are long term loans secured by bare ground with intentions to build in 24 months reportable and are they reported as purchase loans?
I attended a seminar last week and I discovered that our bank, which I thought was approving and selling loans, was actually acting as a broker. Upon speaking to the primary loan officer for these loans I found out that we do not do any of the underwriting for these loans, nor do we make the credit decision. The purchaser is putting these loans on their LAR (as they should), but so have we. I have been working here nearly a year now and just found that information out and I am upset with myself for not knowing this information before now. I looked at our LAR from last year and see that nearly half of the loans on the LAR should not have been reported as they were these brokered loans. It is the same story as far back as 2014. Do we
need to go back and re-submit the LAR(s) or can we proceed as normal? Are we looking at penalties? I am really shocked at this news. After several exams and outside audits, this was never discovered until now. I would really appreciate any tips you can offer.
In 2015 we reported this commercial loan as a Home Improvement loan on the LAR. The loan was commercial non-revolving line of credit for $50,000 that matures on 11/1/2016.
On 5/15/2016 the borrower came back for an additional $30,000 to be added to this loan as the improvements are not complete. The additional funds paid off a non-dwelling secured loan, a small advance to the borrower, and the rest remains available on the non-revolving line of credit. None of the new funds satisfied any dwelling secured loans.
In most cases when a borrower requests additional funds, we pay off the existing loan and book a new loan for the total of the old loan + the new amount request. Thus, it is always reported for HMDA as a home improvement as loans that are for both refi + home improvement = home improvement.
In this case, being this is a commercial loan, the lender did not pay off the existing dwelling secure loan. We just added an additional $30,000 to the line of credit. Because we didn’t “satisfy” any dwelling secured loans, am I correct that this is not reportable for HDMA and is technically considered a Commercial Modification. Is this the correct interpretation of this loan?
If any of the additional funds paid off/satisfied another dwelling secured loan, would this be considered HMDA reportable as either a refinance or home improvement loan? If so, is the entire loan amount reportable or just the increase?
It is my understanding that when a loan is HMDA reportable, the information contained on the HMDA addendum must be gathered "at the time of application." Does this requirement also apply to the property type, occupancy type, collateral address or improved address? Or, can that information be obtained after the app is submitted?
Would this five year unsecured installment loan be HMDA reportable? The funds needed for purchasing upgrades on a new construction property which will eventually be their primary residence when construction is complete.
If we have a loan application taken in 2017 but the loan is not closed until 2018, when should we report this for HMDA?
If we are required to report open-end lines of credit for HMDA in 2018, will this include, unsecured credit cards and/or commercial lines of credit?