Hello. I am new to HMDA and struggling to figure out which Occupancy Type to choose for this particular scenario. We have a customer that is refinancing their primary residence to build a primary residence for their mother. Both homes are collateral. So my reason would be purchase since that overrides refinance, but the options for Occupancy Type are only Primary Residence, Secondary Residence or Investment. I don't think the mother's residence would be any of these options. What do y'all think?

Reg C 1003.4(a)(6) states the occupancy selection is made depending on "Whether the property identified in paragraph (a)(9) of this section is or will be used by the applicant or borrower as a principal residence, as a second residence, or as an investment property.

If your borrower is not residing in the residence being built through the "purchase" then your response would be an investment property.

Why not report his primary as the HMDA address and report it as Occupancy Type 1-Primary Residence? Takes the guess work out of it all.

Both homes are collateral.

I agree with Burke's reasoning. See the OSI to 1003.4(a)(9) addressing multiple properties.

Thank y'all for the help!

We have two borrowers one of whom will reside in the home as their primary residence. The primary borrower was needed to qualify to the loan and the application shows investment for this borrower. We have always reported these as owner occupied since the home is primary to one of the borrowers. Am I correct in my thinking?

If one of the borrowers will occupy the dwelling as their primary residence then you will report the Occupancy Type as Code 1 - Primary residence.

Thank you, Dan.