We are working on a loan to an entity that is purchasing a guest ranch. The ranch contains a lodge and several homes that are rented out for guests that are there to hunt, fish, etc. They also hold various company and church retreats, renting out the facilities for overnight guests. In addition, the ranch hosts a summer camp for young girls each year. A portion of the ranch is also leased to another company for cattle grazing.

So would this be HMDA reportable as non-owner occupied or would this be a CRA loan?

I am pretty sure I know the answer to this, but it is a rainy Monday and I'm not convinced I'm firing on all cylinders this morning!

What part of the property is a "ranch" exactly? (Just curious, since you mention hunting and fishing, but no actual "ranching" activities.) Just wondering if perhaps it might be exempt from HMDA reporting as ag. purpose. If not, it sounds like a HMDA reportable purchase to me. (Sorry, can't help you with the CRA question.)

I don't read where any of the homes are intended to be permanent residences. It seems that the purpose is to use the dwellings as transient housing for vacations, get-aways, etc. I do not see where this would be HMDA reportable...unless someone is permanently residing in the lodge?.

The appraisal states the property is almost 3000 acres of agricultural land. Part of that property is used for cattle grazing, but not a majority. The website for the property hails it as a working guest ranch.

I feel like it is probably HMDA reportable as well since it really doesn't seem like a majority of the property is used for ag purposes, but wanted to get a feel for what others had to say. I just couldn't wrap my head around whether it would be non-owner occupied HMDA or whether it would be CRA since they are operating it as a business and none of the homes are used as a permanent residence.

WreckEm, will someone be living on the property - probably the lodge - on a permanent basis to oversee operations?

I agree with Melissa. This appears to be transient housing and would not be reportable for HMDA at all.

Even if there will be a live-in caretaker or other staff, I think you could easily exempt this one based on mixed-purpose (majority of the property being commercial 'resort' facility). The only way I think this might be reportable is if the owners will live on site and are purchasing it *primarily* to be their residence with the ranch purpose being secondary.

Melissa - I am working to get that information from the loan officer, but I don't believe anyone will be living on the property.

Thanks for the input, Becca.

I told you guys, it is most definitely a Monday! I need all the help I can get today!

Thank you! I did finally get in touch with the loan officer and the borrower is moving more cattle on to the property and will operate it as a cattle ranch going forward. He will have ranch hands living on the property but will not occupy it as his primary residence.

With this information, I think I agree with you that it is exempt from HMDA.

I truly appreciate everyone's input!

If the transaction is a purchase, then it would fall under this exemption which is found in the Commentary for 1003.2 (Definitions)


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

2. Mixed-use property. A dwelling-secured loan to purchase property used primarily for residential purposes (for example, an apartment building containing a convenience store) is a home purchase loan. An institution may use any reasonable standard to determine the primary use of the property, such as by square footage or by the income generated. An institution may select the standard to apply on a case-by-case basis.

3. Farm loan. A loan to purchase property used primarily for agricultural purposes is not a home purchase loan even if the property includes a dwelling. An institution may use any reasonable standard to determine the primary use of the property, such as by reference to the exemption from Regulation X (Real Estate Settlement Procedures, 12 CFR 1024.5(b)(1)) for a loan on property of 25 acres or more. An institution may select the standard to apply on a case-by-case basis.