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#2015871 - 05/22/15 11:31 PM Multipurpose HMDA Loan
hayat Offline
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hayat
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I’m having a debate with my colleagues regarding multipurpose hmda loans. Scenario: Refi an existing loan that is collateralized by primary dwelling to purchase a vacation home that’ll be collateralized by the primary dwelling. I say this is reported as a purchase and geocode the address of the primary dwelling. My colleagues argue that this is not considered a purchase because it’s not collateralized by the purchased vacation home thus it’s not considered a purchase. To my understanding, a statement by the borrower saying that they are going to purchase a residential dwelling with the proceeds is enough to use the multipurpose exception which purchase trumps all. Does anyone agree or am I way off? Is there any reference to support this?

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#2015873 - 05/23/15 02:20 AM Re: Multipurpose HMDA Loan hayat
Kathleen O. Blanchard Offline

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Kathleen O. Blanchard
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For HMDA, purchase. Must be collateralized by "a" dwelling. For new TRID rules as of 8/1/2015, not a purchase. Must be collateralized by the dwelling being purchased. Under TRID it is a home equity.
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#2015900 - 05/26/15 12:20 PM Re: Multipurpose HMDA Loan hayat
NSF, CRCM Offline
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NSF, CRCM
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VA
Agreed, for HMDA it would be reported as a purchase.

As long as the stated purpose is to purchase a dwelling and the loan will be secured by a dwelling then you have a purchase for HMDA.
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The answers I give are my opinions. Not legal advice.

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#2017427 - 06/01/15 07:20 PM Re: Multipurpose HMDA Loan Kathleen O. Blanchard
complyorelse Offline
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Are you saying that because the new TRID rules call it a home equity loan that the same would go for HMDA reporting purposes? HMDA definitions did not change, did they?

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#2017428 - 06/01/15 07:21 PM Re: Multipurpose HMDA Loan hayat
Kathleen O. Blanchard Offline

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Kathleen O. Blanchard
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No, HMDA does not change (until the new rules are in place.)

As I said, for HMDA, a purchase.
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Kathleen O. Blanchard, CRCM "Kaybee"
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#2017431 - 06/01/15 07:26 PM Re: Multipurpose HMDA Loan hayat
Dan Persfull Offline
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Dan Persfull
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Bloomington, IN
No, they are saying that as of 8/1/15 for HMDA reporting requirements the loan would be reported as a home purchase but for TRID the loan purpose on the LE & CD will be labeled home equity.

This is something that you will need to spend extra time on with your lending staff to make sure they understand the TRID purpose definitions do not have any affect on the HMDA purpose definitions. As you said, those have not changed.
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#2018393 - 06/04/15 03:46 PM Re: Multipurpose HMDA Loan hayat
complyorelse Offline
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Great. Thank you for clarifying.

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#2025804 - 07/08/15 12:45 AM Re: Multipurpose HMDA Loan hayat
hayat Offline
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hayat
Joined: Aug 2013
Posts: 14
Here's a loan scenario: Borrower cashes-out from a free and clear investment apt (8-units) he owns to purchase a new owner occupied home (sfr). The loan will be collateralized by the apt. Correct me if i'm wrong, this is a purchase and I use property address/info of the apt; meaning the address (geocode), owner occupancy (not owner occupied) and property type (multi-family). I believe this is correct but that just shows how HMDA data collection is completely skewed. Please enlighten me if I have this all wrong.

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#2025806 - 07/08/15 04:24 AM Re: Multipurpose HMDA Loan hayat
Kathleen O. Blanchard Offline

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Kathleen O. Blanchard
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Yes. Search the GIR on the word "multiple" for the various instructions.

Page D-5 of the GIR:

1. Multiple properties. A home purchase loan includes a loan secured by one dwelling and used to purchase another dwelling.

Page D-8

1. Occupancy—multiple properties. If a loan relates to multiple properties, the institution reports the owner-occupancy status of the property for which property location is being reported.

Page D-9

2. Property location—multiple properties (home purchase/refinance of home purchase). For a home purchase loan, an institution reports the property taken as security. If an institution takes more than one property as security, the institution reports the location of the property being purchased if there is just one. If the loan is to purchase
multiple properties and is secured by multiple properties, the institution reports the location of one of the properties or
reports the loan using multiple entries on its HMDA/LAR (with unique identifiers) and allocating the loan amount among the properties.
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Kathleen O. Blanchard, CRCM "Kaybee"
HMDA/CRA Training/Consulting/Mapping
The HMDA Academy
www.kaybeescomplianceinsights.com

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