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#2008455 - 04/16/15 03:10 PM Reportable or not
Catm1991 Offline
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MO
I have a loan that is the 2nd DOT to finish the remodel on an I/P, and is a 6M term note. We have the 1st that is an LOC for the purchase and remodeling of the I/P, and it is a 6M term, and of course was not reported because it is a LOC.
So, my question is would this new loan that is being used to finish the remodel be HMDA reportable? I don't think it would, but very unsure!

Thanks.

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#2008469 - 04/16/15 03:26 PM Re: Reportable or not Catm1991
raitchjay Offline
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6M term note? 6 months? Interest only? If so, what are the plans for repayment? Refinance the loan at maturity into long term payments or something else?
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#2008521 - 04/16/15 05:36 PM Re: Reportable or not Catm1991
Dan Persfull Online
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Dan Persfull
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Bloomington, IN
We have the 1st that is an LOC for the purchase and remodeling of the I/P, and it is a 6M term, and of course was not reported because it is a LOC.

So you are saying you have a 6 month term note that is open-end credit?
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#2008587 - 04/16/15 07:11 PM Re: Reportable or not Catm1991
Kathleen O. Blanchard Offline

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Kathleen O. Blanchard
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Too cryptic for me!
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#2008636 - 04/16/15 08:36 PM Re: Reportable or not Catm1991
Catm1991 Offline
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It's not interest only, it's just the customer needed more money so we are taking a 2nd on the I/P property. I am pretty sure it's not reportable. The loan officer states, and the file shows, the intentions of the customer are unknown at this point, so with it being short term and the other factors I think it's not going to be reportable.

Thanks.

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#2008645 - 04/16/15 08:54 PM Re: Reportable or not Catm1991
Kathleen O. Blanchard Offline

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Kathleen O. Blanchard
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By I/P do you mean investment property? And 6M means 6 months?
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#2008647 - 04/16/15 08:56 PM Re: Reportable or not Catm1991
raitchjay Offline
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The 2nd lien loan is fully (or partially) amortizing? Is it an open-end or closed-end loan?
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#2008655 - 04/16/15 09:12 PM Re: Reportable or not Catm1991
Catm1991 Offline
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I/P is investment property, and 6M is 6 months, sorry. And closed-end loan.

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#2008669 - 04/16/15 09:34 PM Re: Reportable or not Catm1991
Kathleen O. Blanchard Offline

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Kathleen O. Blanchard
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Last open question. How will this 6 month loan be repaid?
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www.kaybeescomplianceinsights.com

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#2008782 - 04/17/15 04:50 PM Re: Reportable or not Kathleen O. Blanchard
David Dickinson Offline
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David Dickinson
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Central City, NE
Originally Posted By Kathleen B
Too cryptic for me!

I agree. If you want us to give comments/opinions/consultation, please be crystal clear. Thanks.
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#2008783 - 04/17/15 04:51 PM Re: Reportable or not Catm1991
David Dickinson Offline
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David Dickinson
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Central City, NE
Quote:
The loan officer states, and the file shows, the intentions of the customer are unknown at this point, so with it being short term and the other factors I think it's not going to be reportable.

Short term improvement IS reportable. It's not temporary (replaced by a 2nd phase loan). Why do you think it's not reportable?
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#2009809 - 04/23/15 05:10 PM Re: Reportable or not Catm1991
Catm1991 Offline
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I am new to HMDA and was trained that we do not report loans that are short term, being less than 12 month, but with the research and the 1st training they have sent me to I....think it might, but told it wouldn't be, so I'm unsure??

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#2009826 - 04/23/15 05:42 PM Re: Reportable or not Catm1991
raitchjay Offline
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We need to know what the plan for repayment is: refinance into long-term financing or simply pay the loan off at maturity. If the loan is designed to be replaced by financing of a much longer term, then it's temporary and not reportable. If the loan is designed with the idea of your borrower paying the loan off in cash at maturity, it's simply a short term loan that would be reportable.
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#2009842 - 04/23/15 06:32 PM Re: Reportable or not Catm1991
David Dickinson Offline
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David Dickinson
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Central City, NE
Short Term and Temporary are 2 different things. There is no term for Temporary financing and you cannot say a loan of less than X is temporary. You report short term loans. You do not report temporary loans.

Read §1003.4(d)(3) where it states:
A financial institution shall not report… Temporary financing (such as bridge or construction loans)…

Also, read the HMDA FAQ-Loan Purpose at the FFIEC.gov website where it states, in part:
A loan is not temporary financing merely because its term is short. For example, a lender may make a loan with a 1-year term to enable an investor to purchase a home, renovate it, and re-sell it before the term expires. Such a loan must be reported as a home purchase loan. See §1003.2(h).
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#2009843 - 04/23/15 06:33 PM Re: Reportable or not Catm1991
raitchjay Offline
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David, i'm just concerned that Catm might be using the term "short term" simply because the loan term is, well, short....IOW, it might actually be temporary financing and she is calling it "short term".
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#2009845 - 04/23/15 06:37 PM Re: Reportable or not Catm1991
Catm1991 Offline
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Thank you very much.

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#2009888 - 04/23/15 07:41 PM Re: Reportable or not Catm1991
Catm1991 Offline
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Joined: Jul 2014
Posts: 194
MO
Thank you very much.

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