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#1858540 - 10/04/13 03:00 PM Refinancing Mixed-Use Property
KDF Offline
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KDF
Joined: Jul 2009
Posts: 79
Minnesota
Scenerio: A lake resort is the collateral for a refinanced commercial loan. The borrower's home is on the resort property, but is only a small portion of the whole property value. So, I think this a mixed-use property.

It appears to me, based on the 2013 HMDA Getting it Right Guide, that mixed-use property would not be HMDA reportable for a purchase or improvement because the primary use of this whole property is a lake resort to generate income.

But, is this property HMDA reportable for a refinance? I don't see anything in the Guide relating to refinances of mixed use property.
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#1858554 - 10/04/13 03:10 PM Re: Refinancing Mixed-Use Property KDF
raitchjay Online
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Joined: Oct 2009
Posts: 9,088
OK
If the borrower's home is a building all unto itself (and it sounds like it is), then there is no mixed-use. The mixed-use test is used when a building has mixed-use...it doesn't refer to multiple buildings on the same tract. If the home was part of the security for the original loan and is security again on the refinance, then it's reportable.

To address the other part: if you were dealing with a mixed-use property on a purchase transaction and determined that the property was primarily commercial, then it wouldn't be reportable at refinance either, as the mixed-use test is used to determine whether you are dealing with a "dwelling" or not. When you refinance such a loan, you aren't refinancing a "dwelling" secured loan.
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#1859023 - 10/07/13 03:47 PM Re: Refinancing Mixed-Use Property KDF
Rendar, CRCM Offline
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Joined: Aug 2012
Posts: 38
Indiana
Agreed on both parts. If the building is separate then you have a dwelling on the property and need to proceed as such, regardless of the relative value it brings.

You only need to make the distinction once on a mixed-use property (unless the configuration of the building were to change, i.e. renovating a portion of existing office space into residential apartments or something like that) and then you can carry it forward. If you decide it is residential then you have a dwelling secured loan each time it renews.
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