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#2231855 - 02/27/20 01:42 PM Collecting GMI on a Refi of a HELOC
M&M Offline
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Joined: Nov 2003
Posts: 527
Midwest
I know that on a HELOC, which is secured by the primary residence, used for remodeling a bathroom, we do not collect GMI under Reg B. If the borrower then refinances that same HELOC, which is still secured by the primary residence, do we collect GMI? We have conflicting opinions here on whether GMI is required since the HELOC is secured by the primary residence and is a "refinance". However, the HELOC is not to purchase the primary residence.

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#2231858 - 02/27/20 01:57 PM Re: Collecting GMI on a Refi of a HELOC M&M
Skittles Offline
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Skittles
Joined: Sep 2002
Posts: 13,957
TN
From Reg B:

1002.13—Information for monitoring purposes.
(a) Information to be requested. (1) A creditor that receives an application for credit primarily for the purchase or refinancing of a dwelling occupied or to be occupied by the applicant as a principal residence, where the extension of credit will be secured by the dwelling, shall request as part of the application the following information regarding the applicant(s):

Collection is also required for refinancing of the primary residence of the applicant. In my opinion - refinancing a HELOC secured by the applicant's primary residence requires collection for Reg B purposes.
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#2231894 - 02/27/20 04:04 PM Re: Collecting GMI on a Refi of a HELOC M&M
M&M Offline
Platinum Poster
Joined: Nov 2003
Posts: 527
Midwest
Thanks. The argument I’m having difficulty with is the fact that we don’t collect GMI for the initial HELOC application, which is secured by the primary residence, but we would be required to collect GMI on a refi of that same HELOC 5 years later.

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#2231908 - 02/27/20 04:35 PM Re: Collecting GMI on a Refi of a HELOC M&M
Inspector Offline
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Joined: Apr 2016
Posts: 254
I would agree with Skittles based on a strict reading of the regulation but there are multiple opinions on this topic. Check out this thread:

https://www.bankersonline.com/forum...g-b-government-monitoring-info-and-refis
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Opinions expressed are my own and do not reflect legal advice or the opinions of my employer.

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