How do the appraisal notice rules apply to Commercial Lines of Credit. The Reg B definition seems to indicate that draws on existing lines of credit are not considered an "application." So, in working with a developer that is building dwellings, if they apply for the initial LOC and there are dwellings secured as part of the initial extension of credit, then the lender would be required to provide the notice and the appraisal per Reg. B? However, if no dwelling initially secures the line or the line is existing and a developer is taking draws on it, then there is no "application" and thus the ECOA appraisal rule does not apply? Is there any exemption for a certain amount of dwellings securing a loan? So, if there are 15 dwellings securing a loan, is it required to abide by the ECOA Appraisal requirements, as long as no other exemption applies?

In my opinion, Justin, no. The rule won't apply to a loan secured by multiple dwellings that are builder inventory for sale. See https://www.bankersonline.com/forum/ubbthreads.php/ubb/showflat/Number/2065960 and search the page for "footnote 79."

Thank you, John. I had found that one after posting this. However, it seemed like the Footnote 79 comment was concluded to not really apply to builder inventory situations.

Or, sorry, this is the other similar thread on the issue that I came across: https://www.bankersonline.com/forum/ubbthreads.php/topics/1862537/2

Seems like the opinion was that developer loans were not exempt if they were for separate single family homes.

Correct as long as you are talking about 1st liens on 1-4 family

Thank you for the input, it is much appreciated as always.