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#2224406 - 10/25/19 02:36 PM Purchase or Refinance?
clinds Offline
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Joined: Sep 2017
Posts: 64
We "refinanced" a HMDA Loan for a business entity. At the time of the initial loan, the business entity was named ABC Corp.; however, the Company did a restructure of the business and now this loan is being "refinanced" into XYZ Corp. My question is, would this be considered a purchase because the loan is not made to the same borrower or would we still consider it a refinance?

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#2224409 - 10/25/19 03:05 PM Re: Purchase or Refinance? clinds
Adam Witmer Offline
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Joined: Sep 2010
Posts: 2,585
Was it just a name change (like a branding/DBA thing), or was it an entity change like a merger/buyout?
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#2224413 - 10/25/19 03:32 PM Re: Purchase or Refinance? clinds
clinds Offline
Member
Joined: Sep 2017
Posts: 64
Ownership changed and changed the name but it was not a merger, from my understanding.

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#2224414 - 10/25/19 03:41 PM Re: Purchase or Refinance? clinds
rlcarey Offline
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rlcarey
Joined: Jul 2001
Posts: 77,576
Galveston, TX
If it was the same entity and they just changed their name, I would say refinance. But hard to say from your description. It is going to be fact specific.
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#2224415 - 10/25/19 03:43 PM Re: Purchase or Refinance? clinds
Dan Persfull Offline
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Dan Persfull
Joined: Aug 2002
Posts: 46,460
Bloomington, IN
Ownership changed

Not a refinance - not the same borrower.

If property ownership changed prior to your loan it would not be a purchase and this loan would not be reportable.

If property ownership is changing as part of your loan transaction then it is a purchase and reportable.
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The opinions expressed are mine and they are not to be taken as legal advice.

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#2224418 - 10/25/19 04:02 PM Re: Purchase or Refinance? Dan Persfull
clinds Offline
Member
Joined: Sep 2017
Posts: 64
Thanks Dan. The property ownership is changing as part of the loan transaction.

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