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#2176821 - 05/04/18 08:44 PM 12 M Bridge Loan
Catm1991 Offline
100 Club
Joined: Jul 2014
Posts: 194
MO
Ok, I have been reading and reading 'till my eyes are now burning...I know I have read the section regarding temporary/short term loans (bridge loan in this case) but I can't seem too find it at this moment and my eyes are going crosseyed.

So, my question is...I have a loan that is for 12M loan for cash out too purchase another home, and this 12M loan will be paid off once this home (their primary residence) sells, reportable or not reportable??

I would think it would be reportable under the new guidelines.

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#2176822 - 05/04/18 08:46 PM Re: 12 M Bridge Loan Catm1991
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 47,517
Bloomington, IN
That does not meet the definition of temporary financing therefore it would be reportable regardless of the loan term.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

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#2176824 - 05/04/18 08:50 PM Re: 12 M Bridge Loan Catm1991
Dan Persfull Offline
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Dan Persfull
Joined: Aug 2002
Posts: 47,517
Bloomington, IN
Here's the cite from 1003.3

Paragraph 3(c)(3)

1. Temporary financing. Section 1003.3(c)(3) provides that closed-end mortgage loans or open-end lines of credit obtained for temporary financing are excluded transactions. A loan or line of credit is considered temporary financing and excluded under § 1003.3(c)(3) if the loan or line of credit is designed to be replaced by separate permanent financing extended by any financial institution to the same borrower at a later time.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

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#2176839 - 05/04/18 09:34 PM Re: 12 M Bridge Loan Catm1991
Catm1991 Offline
100 Club
Joined: Jul 2014
Posts: 194
MO
That's what I thought. Thank you Dan. And thank you for the cite. smile

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