Our doc vendor is applying the Appendix D assumptions to loans that are for construction but not solely for construction in figuring out the Projected Payments Table. Apparently, according to their "legal interpretation" the following loans would apply to Appendix D:
1. Purchase loans that also have construction proceeds
2. Refinance loans where a portion of the funds are to refinance an existing lien and funds are also to construct
3. Construction loans where a portion is for construction and the rest are for home equity purposes (such as debt consolidation and would be disbursed at closing)

Having read Appendix D, I do not see where in the regulations that is blessed or based. I do not see such a blessing under 1026.17(c)(6) nor in Appendix D.

If you don't know when all the advances are going to happen, you have to estimate the disclosures. As long as the estimations are considered reasonable and in good faith, then whatever method you use is acceptable, Appendix D or not.

Hi Randy, but we know we are immediately disbursing the refinance funds since that has to be paid at closing to secure our lien position, same as for purchase transactions. Also, for debt consolidation, those funds are disbursed at closing. So I don't see how we can assume 50% of the loan amount when for example, $400,000 loan amount with $300,000 for refinancing, and $100,000 is for construction. Our vendor is still calculating based off of 1/2 of the loan amount, so assuming $200,000.

I know - but good luck finding a vendor to support that. You are most likely looking at manual calculations.