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#2189453 - 08/16/18 07:20 PM Change in purpose
beegee Offline
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Joined: Feb 2004
Posts: 1,090
South
We originated a loan to an individual for rental property in which his daughter was paying rent - so business purpose.

Now he wants to add his daughter to the note so she can build credit.

Given this is would be her primary residence would the purpose change to consumer and if so - would we need to do consumer real estate disclosures?

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#2189481 - 08/16/18 08:36 PM Re: Change in purpose beegee
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 78,958
Galveston, TX
Is she also going to be in title to the property?
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#2189483 - 08/16/18 08:44 PM Re: Change in purpose beegee
beegee Offline
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Joined: Feb 2004
Posts: 1,090
South
Good question: I am not sure.

How would it affect the outcome if she is and is not?

Thanks

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#2189491 - 08/16/18 09:09 PM Re: Change in purpose beegee
John Burnett Offline
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John Burnett
Joined: Oct 2000
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Cape Cod
If she's an owner and borrower, the dwelling will be owner-occupied. It becomes a consumer loan.
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#2189493 - 08/16/18 09:12 PM Re: Change in purpose John Burnett
beegee Offline
Diamond Poster
Joined: Feb 2004
Posts: 1,090
South
ok - thanks

If she does become an owner I am assuming we would have to do a new loan mid-stream to accomplish this? - or could we make the modification and just issue new disclosures and move on as is?

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