Section 226 .22(a)(5) allows the additional tolerances for mortgage loans. Does the allowance for overdisclosure only apply to residential mortgage loan transactions for the purchase or refinance of a dwelling or does it apply to any consumer loan secured by a mortgage and subject to MDIA? We make tax advantage loans where the consumer buys a car and we take a security interest in the auto. In addition, we take a security interest in the home for tax purposes only. The loan is classified as an auto loan and secured by the auto and home.
If we over disclosed the APR would we be covered under this additional tolerance allowed for mortgage loans under 226.22?

I assume you are giving the GFE, using the HUD settlement statement, doing flood checks and providing the ROR for these loans.

If the loan is "real estate" secured the real estate allowances in 226.22 apply.



Oh, BTW, starting tomorrow these loans will require an ETIL also.

Will an ETIL be required for:
1. Extension of loan
2. Renewal of loan
3. modification of loan
4. Construction loan

As always thanks to BOL

1 & 3 = No.

2. If the renewal qualifies as a refinancing yes. IOWs if the "renewal" note satisfies and replaces the existing note then it is a refinancing.

4. Construction only loans are exempt from RESPA therefore 226.19(a) would not apply.

2. We always issue a new note with renewals. This is considered a refinance (even if the only thing that changed was the maturity date) because we've issued a new note?

When property is attached, do you have to satisfy and replace the mortgage as well in order for it to be considered a refinance or is it driven by the new note only?

If the new note satisfied and replaced the existing note then it is now your legal obligation and you have refinanced the existing obligation.




No. The mortgage is not your obligation. The note is. The following is from the HMDA FAQs.

Refinancing --- satisfaction of lien. Is the satisfaction of a lien (mortgage) relevant to determining whether an obligation is a reportable refinancing?

Answer: No, the satisfaction of a lien is neither necessary nor sufficient to create a reportable refinancing. The credit obligation must be satisfied and replaced; it is not relevant whether the lien is satisfied and replaced. See 203.2(k)(2)

Thank you, Dan. I appreciate your response.