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#203020 - 06/22/04 10:56 PM Mobile Home Purchases - Inventory or 1-4 Families?
Anonymous
Unregistered

Here's my scenerio.....
Loan w/an indivdual as the borrower;
proceeds are to "purchase mobile home for resale"
and the collateral is the mobile home
on a 2 month term loan.
So, in the cases where individuals buy one mobile home @ a time (not a floor plan), fix them up and sell them,
would you consider them as "inventory" and report on the CRA register
or consider them as "1-4 family residences" and report them on the HMDA LAR?

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#203021 - 06/22/04 11:20 PM Re: Mobile Home Purchases - Inventory or 1-4 Families?
berico Offline
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Joined: Jun 2004
Posts: 290
California
They would never go on the HMDA LAR, because as a two month term loan they would be considered temporary financing.

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#203022 - 06/23/04 03:22 PM Re: Mobile Home Purchases - Inventory or 1-4 Families?
Anonymous
Unregistered

We don't view temporary financing on just the length of the term of the note.
Temporary financing, such as a construction-only. For purposes of this regulation (HMDA), our bank defines “temporary financing” as a loan meeting all of the following characteristics:

1. The term of the loan involving a home purchase is less than two (2) years;
2. The principal is not amortized for repayment within the maturity; and
3. The loan will likely be satisfied by a refinance (by us or another lender), rather than a payoff.

Not all short-term loans should be considered temporary financing. For example, if the customer obtains a two year note to purchase real estate and indicates that the satisfaction of the debt will be met when the property is resold (by loan maturity), then this loan would not be considered temporary financing.

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#203023 - 06/23/04 03:35 PM Re: Mobile Home Purchases - Inventory or 1-4 Families?
Andy_Z Offline
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These are temporary and are for resale, not HMDA.
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#203024 - 06/23/04 07:22 PM Re: Mobile Home Purchases - Inventory or 1-4 Families?
Anonymous
Unregistered

Ok, so let's agree to disagree about our definition of temp. finanicing, so what would you consider the collateral, inventory or 1-4 family residences?

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#203025 - 06/24/04 08:53 PM Re: Mobile Home Purchases - Inventory or 1-4 Families?
David Dickinson Offline
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David Dickinson
Joined: Nov 2000
Posts: 18,762
Central City, NE
Quote:

Ok, so let's agree to disagree about our definition of temp. finanicing, so what would you consider the collateral, inventory or 1-4 family residences?



First, we can't agree to disagree. This is temporary financing. I agree with you that "temp" is not a term. You can have short term loans that are HMDA reportable, but this is for resale, so it is NOT reported.

Second, a MH is a dwelling. This is not inventory.
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http://www.bankerscompliance.com

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#203026 - 06/25/04 08:25 PM Re: Mobile Home Purchases - Inventory or 1-4 Families?
Terry Offline
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Terry
Joined: Sep 2001
Posts: 314
Midwest
I agree with David's statements about temporary financing.

However, what should we consider a similar situation in which we grant a loan to a mobile home dealer secured by mobile homes for the purpose of financing the purchase of the mobile homes for resale. Shouldn't we consider that to be a CRA small business loan secured by inventory rather than a HMDA loan for the purchase of dwellings?
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#203027 - 06/28/04 02:40 PM Re: Mobile Home Purchases - Inventory or 1-4 Families?
SMQ, CRCM Offline

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Posts: 4,825
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Terry, I would make the argument that in the case of a dealer, I would report this as CRA and consider the MHs as inventory. They are not inhabitable during the time that they are on the lot, not afixed to property, no utilities, etc.
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#203028 - 06/29/04 01:47 AM Re: Mobile Home Purchases - Inventory or 1-4 Families?
David Dickinson Offline
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David Dickinson
Joined: Nov 2000
Posts: 18,762
Central City, NE
Quote:

Terry, I would make the argument that in the case of a dealer, I would report this as CRA and consider the MHs as inventory. They are not inhabitable during the time that they are on the lot, not afixed to property, no utilities, etc.



I agree. As long as they are on the dealer's lot, they are inventory, but when purchased they become a dwelling.
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http://www.bankerscompliance.com

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