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#2139814 - 07/27/17 08:07 PM ATR for modular home secured by bare land
ns Offline
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Borrowers want a closed-end, multiple-advance loan for 6 to 9 months when purchasing a modular home that is secured by bare land. When construction is complete on the modular home, they would like to set up annual payments that are amortized over 15 years with a 5 year balloon. However, LaserPro is not allowing that, only a 7/1 or 10/1 ARM loan.

Would ATR apply?

I need help interpreting 1026.43 because I'm understanding ATR would not apply to this loan as it is secured by bare land which is exempt under 1026.43 (a) yet would the General ATR Credits listed under 1026.43 (c) require ATR? Please help!

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Ability to Repay/Qualified Mortgage Rule
#2139815 - 07/27/17 08:11 PM Re: ATR for modular home secured by bare land ns
rlcarey Offline
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rlcarey
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Galveston, TX
At what point of time are you taking the modular home as collateral?
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#2139844 - 07/27/17 09:14 PM Re: ATR for modular home secured by bare land ns
ns Offline
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The bare land will always be used as collateral.

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#2139845 - 07/27/17 09:16 PM Re: ATR for modular home secured by bare land ns
rlcarey Offline
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rlcarey
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Galveston, TX
Wait a minute - you said a modular home - is it going to remain personal property and not secure the transaction?
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The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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#2139924 - 07/28/17 02:44 PM Re: ATR for modular home secured by bare land ns
ns Offline
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Posts: 120
Correct. So since there is no dwelling to secure would it be exempt from ATR requirements?

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#2139931 - 07/28/17 02:56 PM Re: ATR for modular home secured by bare land ns
rlcarey Offline
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rlcarey
Joined: Jul 2001
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Galveston, TX
With no dwelling as security it would not be a covered transaction.

1026.43(b) Definitions. For purposes of this section:

(1) Covered transaction means a consumer credit transaction that is secured by a dwelling,
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The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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#2139932 - 07/28/17 02:57 PM Re: ATR for modular home secured by bare land ns
ns Offline
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Joined: Aug 2016
Posts: 120
Perfect. Thank you! I appreciate the guidance.

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#2140329 - 08/01/17 03:33 PM Re: ATR for modular home secured by bare land ns
RR Joker Offline
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The Swamp
I would like to know how in the heck a modular home can be excluded. It's not chattel property. Titles, even if in existence to move sections on a chassis, are not maintained on the finished product. Is this different in some states??
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