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#2090906 - 08/01/16 05:45 PM MAPR on Land-Only Loans
Indy Banker Offline
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Since the MAPR includes fees that are often excluded from the finance charge calculation under Reg Z, does this mean real estate-related fees that are normally excluded under Reg Z have to be included in the MAPR? If these need to be included for land or lot purchase loans, this will blow the MAPR up unless the loan balance is large enough to absorb the fees.

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#2091095 - 08/02/16 05:00 PM Re: MAPR on Land-Only Loans Indy Banker
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Where would an exclusion be to discount those fees? The loan is included in the MLA scope and the fees would be restricted to conform to the MAPR.
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#2091186 - 08/02/16 09:05 PM Re: MAPR on Land-Only Loans Indy Banker
Ninky Offline
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How are lot loans not exempt? Isn't a lien on a lot a mortgage, which is exempt. And if it's not considered a mortgage, would it not then be considered a purchase of personal property secured by the property purchased? We thought lot loans would be exempt from the new MLA rules.

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#2091191 - 08/02/16 09:09 PM Re: MAPR on Land-Only Loans Indy Banker
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232.3(f)(2) Exceptions. Notwithstanding paragraph (f)(1) of this section, consumer credit does not mean:

(i) A residential mortgage, which is any credit transaction secured by an interest in a dwelling, including a transaction to finance the purchase or initial construction of the dwelling, any refinance transaction, home equity loan or line of credit, or reverse mortgage;

They specifically say secured by a dwelling. No dwelling, no exception.

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#2091192 - 08/02/16 09:13 PM Re: MAPR on Land-Only Loans Indy Banker
mtngrrl Offline
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The Act defines a residential mortgage this way:

232.2 (f) (2)(i) A residential mortgage, which is any credit transaction secured by an interest in a dwelling, including a
transaction to finance the purchase or initial construction of the dwelling, any refinance transaction, home equity loan or line of credit, or reverse mortgage;

Since a land loan is not secured by an interest in a dwelling, it got left out of the definition of a "mortgage", so it's included. This may have been an oversight by the DOD, and maybe it will get changed, but for now lot loans are included.
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#2091193 - 08/02/16 09:14 PM Re: MAPR on Land-Only Loans Indy Banker
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CULady beat me to it!
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#2091855 - 08/05/16 03:10 PM Re: MAPR on Land-Only Loans Indy Banker
raitchjay Offline
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I'm a bit confused.......the MLA says "finance charges"......it doesn't trump Reg. Z ....so if it isn't a "finance charge" under Reg. Z (not counting the things that the MLA says you HAVE to include in the MAPR), how does it magically become a finance charge under MLA? Or am i missing something?
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#2091866 - 08/05/16 03:18 PM Re: MAPR on Land-Only Loans Indy Banker
raitchjay Offline
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IOW, if it's not a finance charge under Reg. Z, and it's not a fee that the MLA says you have to include in the MAPR.....then it doesn't go in the MAPR..right? And there's nothing in the MLA that would say that real estate related fees that Reg. Z lets you exempt from the FC must now be included, right?
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#2091984 - 08/05/16 06:54 PM Re: MAPR on Land-Only Loans Indy Banker
raitchjay Offline
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OK
bump....anyone?
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#2092016 - 08/05/16 08:17 PM Re: MAPR on Land-Only Loans Indy Banker
RR Joker Offline
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That's how I've interpreted it and thought it was, raitchjay. Maybe Andy could elaborate on his comment??
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#2093924 - 08/18/16 01:42 PM Re: MAPR on Land-Only Loans Indy Banker
Indy Banker Offline
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I'm still not clear, and maybe nobody knows for sure right now, do fees for real estate related transactions such as appraisal fee, title insurance, etc., have to be included in the MAPR for covered transactions (lot loans)???

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#2093929 - 08/18/16 01:50 PM Re: MAPR on Land-Only Loans Indy Banker
raitchjay Offline
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I don't see anything in the MLA that trumps Reg. Z's definition of a finance charge, and those fees (unlike credit life insurance premiums) aren't expressly included.
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#2093930 - 08/18/16 01:50 PM Re: MAPR on Land-Only Loans Indy Banker
raitchjay Offline
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Reg. Z's exemption for real estate related fees is still in play IMO. I don't see why it wouldn't be.
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#2094002 - 08/18/16 04:25 PM Re: MAPR on Land-Only Loans Indy Banker
Andy_Z Offline
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Perhaps I didn't explain it well or had a senior moment. As I read it the Reg Z FCs will be FC's plus:
Credit Insurance
Debt Cancellation fees
Products Sold in Connection with the Credit Transaction (e.g. Credit Default Insurance and Debt Suspension Plans)
Finance Charges
Application Fee

On a RE loan, in my experience, many of these add-ons are not typical as they are for a consumer loan, say with credit life that could put it over the top, depending on the terms.
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#2098408 - 09/14/16 02:39 PM Re: MAPR on Land-Only Loans Indy Banker
Jade'sFire Offline
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We are running with the idea that title fees, appraisal fees, recorded mtg fees on a lot loan will not be included in the MAPR calculation. Is this in agreement with what others are doing?

I read this thread and really got confused as to what the final consensus was....if there was one smile
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#2098419 - 09/14/16 03:17 PM Re: MAPR on Land-Only Loans Indy Banker
RR Joker Offline
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Agree. Not sure, however, where title fees would come into play on a land loan, unless you mean normal attorney fees, other than closing/settlement charges, if any.
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