We have an application to purchase a home and 30 acres. The applicant also owns 30 acres of bare land that adjoins the purchase property that he would like to use the equity in as a down payment. The applicant owes a different Lender roughly $100,000 on the bare 30 acres he is pledging so we would need to refinance it.

How are you typically completing these types of transactions?
Would you disclose it as a single Purchase loan where the purchase price is lower than the loan amount?
Would you keep it as two different transactions where you would refinance the bare 30 in one loan and complete the purchase as a separate transaction?

The applicant would like to have one loan so they're making one payment a month.

Thank you in advance for you help!

It would be a purchase as purchase trumps refinance for purpose on TRID. Everything else is a business decision.

What do other lenders typically do?

We report as one transaction and a purchase. The purchase price is the purchase price and the other loan will show in the adjustments section to give the correct cash to close.

We’ve run into this before too. We just aren’t sure how to properly disclose this on the LE. Any advice?

We disclose the LE and report the transaction to HMDA as a Purchase. The Loan Amount would be higher than the Purchase Price. We haven't had any problems with the funds from borrower reflecting the correct amount on the LE.
Three things we encounter and have to watch for are:
Make sure LO is increasing the fees to accommodate the second property (Appraisal, Flood, Recording, etc). We have had to pay for a couple appraisals and flood certs because of LO errors.
Our LOS is set to figure the LTV based on the purchase price or appraised value, whichever it lower so we have to make sure we document that we used the Purchase Price/Lower on the Purchase + Appraisal on blanket property to calculate the true LTV. The underwriter can override the system calculation and update the LTV field accordingly.
HMDA fields may need manually adjusted to show the Property Value based on the underwriter calculation.