Customers had a commercial loan on 1-4 family property that was run as a group home. We did not initially report this loan as it was commercial. Since then the customers have dropped their certification and live in the property with two other individuals that they care for. The commercial loan is in the process of being renewed. The Customers would like this loan to start reporting to the credit bureaus. Firstly, since they are no longer running the commercial business, would this flip the loan to a consumer purpose and then be covered by the consumer regs or can we keep it commercial purpose as it always has been? Second question is if it is a commercial loan and we don't normally report them, are there any implications to making an exception for this loan?

since they are no longer running the commercial business, would this flip the loan to a consumer purpose and then be covered by the consumer regs

Yes

Second question is if it is a commercial loan and we don't normally report them, are there any implications to making an exception for this loan?

Think fair lending.