Is a consumer bridge loan to purchase a new home secured by the existing and new home for a 1 year term that will be possibly fully paid off when the existing home sells HMDA reportable? The lender documented that the loan will likely be paid off in full in the file and a permanent take out was not obtained.

The 3(c)(3) paragraph 1. i. commentary example refers to the remaining balance later permanently financed. If the plan is for no subsequent loan, does that make the bridge loan reportable as a purchase?

The loan is not intended to be replaced by longer term financing therefore it is not exempt from reporting under the temporary loan exemption.

Thanks Dan Persfull that's what I was thinking too about the original situation,then this came up....

**update - as it turns out, the balance did not pay off with the sale and the remaining debt will be refinanced with our secondary market division, does this loan now qualify for the temporary financing exemption?

You have to make the determination at the time the loan is made, based on the best knowledge available at the time. You don't have to (nor should you) monitor your portfolio and go back after the fact and add or delete loans from your LAR.

First, I agree with Dan that this is a short-term (reportable) HMDA purchase.


This is why I often say "HMDA is an application regulation. What do you know at the time of application. Things can change, but that doesn't make you wrong about what you knew at the time of application."

If the intent is to pay off the bridge loan in 1 year, it's reportable. If the borrower comes back in 1 year and wants a permanent loan, you will have a new request for credit to report.

David, I like that - application regulation. That's a good way to put it.

That also will help you explain when to collect Demographic Info.