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#1652525 - 01/18/12 11:11 PM Multiple short term loans
SouthoftheBorder Offline
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Joined: Feb 2002
Posts: 335
The South
an ugly situation - we gave a purchase/constuction loan to customer - we were going to convert to perm financing at end of construction....no construction done - no draws etc.....well he never sold his existing house which is now under water and he has the purchased home on the market to sell...we gave him a short term note in hopes he would sell it - we did not put the loan on the LAR....this has been going on for a couple of years now - short term refinancing in hopes he pays it off when he sells it....are we OK not putting it on the LAR? btw - it is not occupied....

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#1652975 - 01/19/12 05:28 PM Re: Multiple short term loans SouthoftheBorder
Dan Persfull Offline
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Dan Persfull
Joined: Aug 2002
Posts: 47,517
Bloomington, IN
If I'm understanding correctly you gave the borrower a short term note (refinancing the purch/const loan) on the home he purchased with the original loan to give him time to sell it. If that assumption is correct then I would have to opine you have several reportable short term loans as I don't see them being temporary financing based on your post.
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#1653891 - 01/20/12 08:13 PM Re: Multiple short term loans SouthoftheBorder
Adam Witmer Offline
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Joined: Sep 2010
Posts: 2,658
Originally Posted By: Loan-A-ranger
short term refinancing in hopes he pays it off when he sells it


Short term financing does not equal temporary financing.

The first note would have been exempt from HMDA because it was a construction loan. The following notes appear to be short term but not temporary financing because they are not "designed to be replaced by financing of a much longer term." It appears they were designed to be paid off by a sale, not by a refinance into a much longer term. Therefore, I see these as HMDA reportable loans.
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Adam Witmer, CRCM

All statements are my opinion, not those of my employer, and should not be taken as legal advice.
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