I have a commercial loan secured by 3 mobile home parks and wanted to report it as a community development loan. However, it is HMDA reportable. I know it can't be reported with my small business/small farm CRA data, but can I claim it as community development? (fingers crossed)

We are looking at similar situations - we have 2 deals each in excess of $3MM. They are each construction loans with mini-perms at the end of the construction periods. The perm loans are less than $1MM each. The first transaction is a LIHTC deal secured with 1st mortgage on 33 LIHTC single-family scattered site homes (multiple single family dwellings) and the second transaction is a SBA perm loan to pay off construction loan secured with business assets and a single family residence taken as "Abundance of Caution". We believe these are both HMDA reportable but can they be counted as CD Loans as well? Is there guidance to use to resolve this confusion?

Yes, a permanent loan to a for-profit entity secured by and made for the purpose of purchasing, refinancing or improving a multifamily dwelling with a primary purpose consistent with the definition of community development can be reported under both HMDA and as a CRA community development loan.

I use this grid a lot.

https://www.dallasfed.org/assets/documents/cd/pubs/craloan.pdf

Thank you RR Jen, I agree with the assessment for multi-family but these are secured by single family residences (scattered site). So I don't think they meet the definition of multi-family. Wouldn't that throw them into HMDA reporting?

Using Appendix D of HMDA Getting it Right, pg 5 or the section on Data Reporting in General, pg 9, Transactions not to be reported includes "Construction Loans and other temporary financing (but construction-permanent loans must be reported). This makes me think we have an issue.

This chart is great! Thanks RR Jen. I can report the same loan for both, IF the loan qualifies as community development. That said, because mobile homes by nature provide affordable housing, would you say this loan qualifies? The appraisal includes an affordability analysis that demonstrates the monthly costs of a manufactured home are much lower than a single-family home in the same area. What other documentation should I be gathering?

CRAHunter...how much is your loan? I am not a HMDA expert, I usually ask that team to make the call. I'd struggle to not report a LIHTC project as a CDL.

Mel...I wouldn't rely on it being a MH alone. Get the HUD fair market rent numbers, is this rent below that? how much? Ask your lender to contact the borrower and get an estimate of how many tenants are LMI.

Our loans are in excess of $3million and $6million. So a significant impact if we can't count Low Income Housing Projects as a CDL. Thanks for the follow-up. The permanent portion only occurs at the end of the construction phase for approximately $400K and $700k. We only convert to perm if the terms of conversion are met. I also confirmed that they are reported as "construction" loans on the Call Report.