We have a now funded land development loan on a property with an occupied existing SFR that will remain occupied by a tenant. The land development loan paid off a lien on the property (same owner/borrower), and also provided a draw-down line (non revolving) to develop a property surrounding the home into individual lots to eventually sell. The home is occupied and will be sold after the 18 month land development period. To me, this is a refinance that is HMDA reportable - anyone disagree?

Agree. Refinance.

I also agree. Refinance.

Thank you - I debated on Home Improvement, however, the existing home is not being improved - only the land surrounding the home, and that is not for the existing home.

I have a similar situation and am not sure if it needs to be reported as a Home Improvement or not. Borrower is going to construct an 8,100sf warehouse on an eight acre tract of land that also happens to have his personal residence located on it. The warehouse will be used to store inventory for his business and the note is being made on a five year term vs temporary construction. Since the property where his residence is located is being "improved" do we need to report it on the HMDA LAR? None of the funds will be used to pay off any existing mortgage on the property. They are all being used for the construction of the warehouse.

The funds are not used to improve the dwelling or the real property (dwelling related). Therefore, this is not a HI loan.

Julie - we've had this situation come up one way or another at our bank a number of times. I certainly think you could argue either way, but we would not report the loan you described. The funds are to improve the same dirt the house sits on but the improvement is for business purpose, not improving a residential property directly (home, in-ground pool etc).

We have taken a similar question to our regulators: a loan to a farmer to put drainage tile in the ground on his 80 acre farm and build a machine shed to store his farm equipment (improving the farm - business purpose). We have the farm as collateral and there is a dwelling on the farm. Our regulators (FRB) agreed, not HMDA reportable as improvement due to the mixed-use property exception and advised us to have supporting documentation in the file.

Thanks for the input. I didn't think it would be reportable, but began second guessing myself when they placed the order for an appraisal on the warehouse to be built. The house is being excluded from the appraisal order.

I appreciate some back-up with the "mixed-use" of the property option.