need a little help working this one out.

Customer purchases a dwelling for his daughter using a business LOC. A year later he wants to pay-off the LOC so he can use it for other things. He is taking out a closed-end loan with his daughter to pay the LOC.

So, there are different borrowers (adding the daughter) and if the LOC is not closed is the new loan really "satisfying and replacing"? Does this fit the definition of refinance? is it a purchase?

Thanks in advance!

I will vote not reportable. It's no longer a purchase and it doesn't fit the HMDA refi definition.

that is what I am leaning towards also ... it just doesn't seem right for some reason

Since the LOC is not replaced by this loan, this is not a refinancing. I agree with Becca this is not a purchase and it doesn't meet the definition of refinancing, so it's not reported. It's one of those that falls through the cracks. I would document why you're not reporting it as it could come up again and you may not remember the details of why you chose not to report it.

Point of clarification: Adding the daughter doesn't make it not a refinance. Dad is still on both loans, so it could be a refinancing if the other conditions were met.