We have a current borrower that is requesting a line of credit to purchase investment property. In further discussion with them we found it was a home for their child. They are likely going to pay off the line of credit quickly and then use it for their current business. They are using their home as collateral. Do TIL & RESPA apply?? Do they get rescission....if TIL doesn't apply I would say no.

If it is line of credit, you are talking about a HELOC and not a closed end loan subject to Subpart C of Regulation Z and RESPA GFEs and HUD-1s. Buying a home for a child is personal purpose all the way.

If they want a personal line, you make them a personal line.

If they want a business line, you make them a business line.

You don't do both as you are not going to want to give them all the protections afforded a consumer under the HELOC rules.