Hello. I have come across a unique situation I have not encountered before. We are doing a new construction/perm loan to finance the construction of commercial storage facilities. The loan will be secured by the storage facilities as well as two residential investment properties. Proceeds of the loan will also be paying off an existing loan secured by residential investment properties. Would this loan be HMDA reportable as a refinance since both the existing loan and new loan will be secured by residential dwellings? What is throwing me off is the construction/perm loan. Basically, the borrower has a loan secured by 5 residential investment properties. He is taking out a construction/perm loan where proceeds will be used to pay off the existing loan and then tear down 3 of the residential properties and construct the storage facilities. Two of the investment properties will remain as collateral for the loan. Your thoughts are greatly appreciated it!!

The residential dwelling collateral and the payoff of the prior dwelling secured loan by this permanent financing do bring this under HMDA as a refinance, assuming that there is at least one borrower the same on the new loan and the loan being paid off.

Similarly, you could have a loan to purchase a printing press partially secured by a dwelling. That loan would not be reportable but when it is refinanced, it will be reportable if the new loan is also dwelling secured in any way and at least one borrower is on both loans.

The actual use of funds is not pertinent.

If the loan being paid off is dwelling secured and the new loan will be dwelling secured, and the borrower is the same, then you have a refinance for HMDA.