We have a construction loan on the books to finance the construction of the borrowers new primary residence. The borrower has come back and requested additional funds to complete the new house. We are planning on replacing the existing loan with a new loan and mortgage which will include the new funds into a new single pay, interest only loan. Will the new loan be a construction or a refinance loan as per TRID rules?
37(a)(9) Purpose states-- Refinance. The consumer refinances an existing obligation already secured by the consumer's dwelling

** currently this "structure" is not the consumer's dwelling so I would still classify the new loan as a construction loan.

Your thoughts...

Refinance

It's a dwelling and it's the consumer's. What it is not -- yet -- is the consumer's principal dwelling/residence. Ditto Randy ^^ -- Refinance.

We have this scenario and had issued the LE with the purpose of Refinance. In reviewing the CD that is going out, we find that our software calculated the monthly P & I amount on the LE as if fully funded from day one. Would this be correct even though this is still a construction loan (being refinanced with new $)?

Is the new money a single advance, or will it be a multiple advance?

The new money will be disbursed in multiple advances. The vast majority of the funds have already been disbursed.

I'm not sure how you could accurately calculate your APR that way. I would have done it as an Additional advance for just the additional funds...but I'm not sure whether that would remain initial construction (my gut says it would) or equity.

Using the scenario above - new construction loan was made pre-TRID. Customer has come back and requested additional funds to complete the construction of what will be his new personal residence. He already owned the lot prior to the construction loan being made.

This question was posed to me this morning: Can a Change In Terms be used to increase the note amount (no other terms are changing), or does a whole new loan, including TRID disclosures, need to be processed?

Does anyone know the answer to my question above or where I can look up what we need to do? Thanks for any help!

I don't know your State law...but I would not see a reason not to do it that way.

We have a construction loan made PRIOR to TRID. It has not matured. Customer wants to extend the maturity date 6 months. I think we would consider this a modification. Under 1026.20, it's not a refinance. Would TRID apply now even though it didn't apply at the time the loan was made? Or can we consider this a mod and no new disclosures would have to be made?