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#2115749 - 01/26/17 10:17 PM
HMDA Reportable Commercial Loans
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New Poster
Joined: Jan 2017
Posts: 17
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A commercial loan is HMDA reportable if it meets the purpose based test AND collateral based test (both)? OR just one or the other meaning if it only meets one of these tests?
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#2115811 - 01/27/17 02:52 PM
Re: HMDA Reportable Commercial Loans
MFlea
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Joined: Jul 2016
Posts: 7
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So, to clarify for Business Loans - any refinance loan to buy business equipment, which is secured by a dwelling is HMDA reportable from 2018?
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#2115840 - 01/27/17 04:04 PM
Re: HMDA Reportable Commercial Loans
MFlea
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Joined: Aug 2001
Posts: 7,351
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I thought that scenario is reportable now.....because it meets the current definition of a refinance. Where is the exemption?
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#2115914 - 01/27/17 06:57 PM
Re: HMDA Reportable Commercial Loans
David Dickinson
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Joined: Aug 2001
Posts: 7,351
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In 2018, a dwelling secured equity loan for business purpose will only be reportable when it is refinanced. Sorry, David, I guess I didn't understand the above statement. But you mean, by the statement, that nothing changes with respect to that scenario from 2017 to 2018.
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#2116393 - 01/31/17 10:47 PM
Re: HMDA Reportable Commercial Loans
MFlea
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Gold Star
Joined: Apr 2015
Posts: 347
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And all agricultural-purpose, not only purchase, are now exempt, correct?
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#2141610 - 08/10/17 07:54 PM
Re: HMDA Reportable Commercial Loans
MFlea
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Power Poster
Joined: Sep 2004
Posts: 5,249
out of the frying pan...
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Please forgive me, but I'm still struggling with two aspects of this.
1) Is the refinancing of a dwelling secured loan that was originally exempt as agricultural purpose (say crop production) reportable - just like it is today - or not?
2) Re: the secured by dwelling and land with a "primarily agricultural purpose" exemption - does it matter if the home is located ON the farmland? For example, if a loan is secured by a residence in town and a separate parcel of farmland located elsewhere, would the "ag property" exemption still be met?
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#2141617 - 08/10/17 08:29 PM
Re: HMDA Reportable Commercial Loans
MFlea
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Joined: Oct 2009
Posts: 9,108
OK
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Becca for 1) I don't think so. It would now be exempt as ag. purpose, if i understand it correctly.
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#2141780 - 08/11/17 07:33 PM
Re: HMDA Reportable Commercial Loans
MFlea
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Joined: Sep 2004
Posts: 5,249
out of the frying pan...
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I understand about the agricultural purpose loans being exempt when they are new money. The fact that they are not specifically excluded from the definition of refinance is what's hanging me up. From what you're saying, though, even the 9th or 10th refi of what was originally an ag loan would still be exempt? No matter what other new funds may have been added to the loan over the course of those multiple refinances? That is assuming, of course, that we have the capability to track records back that far and tell what any given ag coded refi was originally used for.
Please don't read this as me being snarky - I'm just forseeing lots and lots of research time/headaches trying to figure out which loans on the commercial/ag side are reportable refis and which ones aren't.
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#2141826 - 08/12/17 11:15 PM
Re: HMDA Reportable Commercial Loans
MFlea
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Joined: Nov 2000
Posts: 18,763
Central City, NE
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even the 9th or 10th refi of what was originally an ag loan would still be exempt? No matter what other new funds may have been added to the loan over the course of those multiple refinances? Correct. ALL ag purpose loans and loans secured by ag land are exempt. That's the way it was prior to 2004. They are finally reversing the error they made 14 years ago. I didn't read your comments as snarky. You're clarifying.
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#2141843 - 08/14/17 12:20 PM
Re: HMDA Reportable Commercial Loans
MFlea
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Power Poster
Joined: Sep 2004
Posts: 5,249
out of the frying pan...
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Thanks, David. I don't know why I cannot get my head around this. I think the fact that they are treating ag vs commercial purpose refis differently is part of it.
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#2141866 - 08/14/17 03:02 PM
Re: HMDA Reportable Commercial Loans
MFlea
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10K Club
Joined: Nov 2000
Posts: 18,763
Central City, NE
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. . . they are treating ag vs commercial purpose refis differently is part of it. You're right. That makes no sense to me.
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#2141925 - 08/14/17 06:03 PM
Re: HMDA Reportable Commercial Loans
MFlea
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Joined: Nov 2002
Posts: 20,656
The Swamp
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So in the case of the situation where the dwelling is in town and separate from the agricultural land...you have to look hard at your actual purpose because if it's not ag purpose, it would be reportable because the dwelling is not on the ag land.
Oh boy. This is going to be such a cluster for us rural banks.
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#2141926 - 08/14/17 06:08 PM
Re: HMDA Reportable Commercial Loans
RR Joker
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Joined: Sep 2004
Posts: 5,249
out of the frying pan...
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Oh boy. This is going to be such a cluster for us rural banks. That's pretty much what I'm thinking. Most everybody is all excited about getting to exclude all this stuff, and I'm over here banging my head on the desk because they've made figuring out what's included and what's excluded on the ag side that much more complicated. At least for the way this bank operates.
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#2141969 - 08/14/17 08:08 PM
Re: HMDA Reportable Commercial Loans
MFlea
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10K Club
Joined: Nov 2002
Posts: 20,656
The Swamp
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Absolutely! It's going to be a big fat mess.
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#2142060 - 08/15/17 03:40 PM
Re: HMDA Reportable Commercial Loans
MFlea
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10K Club
Joined: Nov 2000
Posts: 18,763
Central City, NE
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The example you give about a residence in town and a farm also securing the loan is interesting. We submitted a similar question to the CFPB about this. Our example was: A loan to improve a dwelling located off the farm (in town). The loan is secured by the home being improved AND by a dwelling located on a farm. Does the exemption apply? Or does it not because the dwelling being improved is not located on the property being used for ag purposes? We just talked to Shelly Thompson at the CFPB about this. She agreed this isn't clear. She said it could go either way (reportable or exempt). She said "make a decision to report or not and document why." In other words, you could say "this is not subject to HMDA because the loan is secured by a dwelling on agricultural land." OR You could say "This is subject to HMDA because the proceeds are not used to purchase/refinance/improve a dwelling on agricultural land." Hopefully, the examiners will see it in the same common sense way Shelly Thompson does.
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#2142067 - 08/15/17 03:48 PM
Re: HMDA Reportable Commercial Loans
MFlea
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Power Poster
Joined: Sep 2004
Posts: 5,249
out of the frying pan...
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I think that "ON agricultural land" bit says a lot. I think I'll stick to reporting anything that meets purchase/refi/improve if the house isn't actually sitting on the farm. That's a lot clearer cut to me.
Thanks for sharing your answer!
Last edited by RR Becca; 08/15/17 03:49 PM.
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#2142107 - 08/15/17 05:34 PM
Re: HMDA Reportable Commercial Loans
MFlea
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10K Club
Joined: Nov 2002
Posts: 20,656
The Swamp
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I agree. "ON" is a key word for this subject.
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My opinion only. Not legal advice. Say you'll haunt me - Stone Sour
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