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#1645361 - 01/03/12 06:07 PM
CRA Small Business Residential Property
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100 Club
Joined: Nov 2002
Posts: 228
Wisconsin
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For a residential loan, under $1,000,000, made to a business to purchase a multi-family property, this would be HMDA reportable but not CRA reportable. Correct?
A refinance of a multi-family residential loan, under $1,000.000, made to a business would be both HMDA and CRA reportable. Is this correct?
A renewal of a multi-family residential loan, under $1,000.000, made to a business where the existing note is not satisfied would not be reportable to HMDA or CRA. Correct?
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#1651076 - 01/13/12 07:11 PM
Re: CRA Small Business Residential Property
Kathleen O. Blanchard
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Gold Star
Joined: Aug 2005
Posts: 443
Northwest
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Kaybee, I am confused by your statement in the (...) could you please give an example..
Sub-set questions We have loan to a small business ( collateral property is multi-use, 1/3 retail store 2/3rds residence of owner) However, all income derived by business owner comes from the store.. this is being refinanced.. does it meet test for CRA?
We have a single purpose entity (LLC) whose sole purpose is to collect rents. We have made the entity a small business loan (under $1 mil) and have taken the collateral as security ( multi-use property both residential & retail stores).. Does this meet CRA test?
Would it make a difference for CRA if collateral is all retail stores for example?
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#1651307 - 01/16/12 05:45 PM
Re: CRA Small Business Residential Property
Kathleen O. Blanchard
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Gold Star
Joined: Aug 2005
Posts: 443
Northwest
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Sub-set questions We have loan to a small business ( collateral property is multi-use, 1/3 retail store 2/3rds residence of owner) However, all income derived by business owner comes from the store.. this is being refinanced.. does it meet test for CRA?
Depends upon how you classified the loan on the call report. Is it classified as secured by residential real estate or non-farm, non-residential real estate?
This case residential, so not CRA? We are a small bank, could we track this and use it as additional evidence of meeting needs of small business?
We have a single purpose entity (LLC) whose sole purpose is to collect rents. We have made the entity a small business loan (under $1 mil) and have taken the collateral as security ( multi-use property both residential & retail stores).. Does this meet CRA test?
Again depends upon how you classified the property, residential or non-farm non-residential. These would be classed as non-residential... so yes, for CRA? Would it make a difference if the owner rented one of the retail units ?
Last edited by Chocaholic; 01/16/12 05:50 PM.
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#1651309 - 01/16/12 06:20 PM
Re: CRA Small Business Residential Property
Chocaholic
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10K Club
Joined: Dec 2000
Posts: 21,293
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Sub-set questions We have loan to a small business ( collateral property is multi-use, 1/3 retail store 2/3rds residence of owner) However, all income derived by business owner comes from the store.. this is being refinanced.. does it meet test for CRA?
Depends upon how you classified the loan on the call report. Is it classified as secured by residential real estate or non-farm, non-residential real estate?
This case residential, so not CRA? We are a small bank, could we track this and use it as additional evidence of meeting needs of small business?
You can categorize as CRA Type 3, which is not submitted but presented in an exam. If the loan falls into HMDA reporting it won't be type 1 OR 3 unless it is a refi.
We have a single purpose entity (LLC) whose sole purpose is to collect rents. We have made the entity a small business loan (under $1 mil) and have taken the collateral as security ( multi-use property both residential & retail stores).. Does this meet CRA test?
Again depends upon how you classified the property, residential or non-farm non-residential. These would be classed as non-residential... so yes, for CRA? Would it make a difference if the owner rented one of the retail units ?
This would be a small business loan (CRA Type 1, assuming it is $1 million or less) because the property is not residential. It does not matter that one of the stores is owner occupied.
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