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#1146603 - 03/17/09 08:34 PM HELOC's for a Purchase
JaimeM Offline
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Joined: Nov 2007
Posts: 41
If funds from a HELOC are used to purchase a primary residence that secures the HELOC (as a 2nd lien), since they can draw on this again does a Right of Rescission need to be done? Also because the funds are used as a purchase do all disclosures for purchases need to be done or just HELOC disclosures??

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#1146713 - 03/18/09 02:34 AM Re: HELOC's for a Purchase JaimeM
Jan94 Offline
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Joined: Mar 2001
Posts: 828
USA
Here's a thread that might help you. If you do a search on "HELOC purchase" or "purchase money HELOCs", you should get several threads that should have the information you need.

http://www.bankersonline.com/forum/ubbth...true#Post880455

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#1146772 - 03/18/09 01:03 PM Re: HELOC's for a Purchase Jan94
RR Joker Offline
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The Swamp
Yes, you do RofR at closing, but not against the funds used for the purchase. It's to cover you for the subsequent draws and keeps you from having to do RofR for EVERY subsequent draw.

As far as disclosure, you do it as you normally do for a HELOC.
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#1146904 - 03/18/09 03:03 PM Re: HELOC's for a Purchase JaimeM
Many Hats Offline
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Orlando, FL
Originally Posted By: JaimeM
do all disclosures for purchases need to be done or just HELOC disclosures??


We've done a lot of these.

Aside from your normal HELOC disclosures, you would also want to give a Consumer's Guide to Settlement Costs booklet.

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#1147072 - 03/18/09 04:40 PM Re: HELOC's for a Purchase Many Hats
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SC
The Settlement Cost booklet isn't needed provided the applicant was given the HELOC booklet (3500.6(a)(2).
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