Is the following considered personal/household purpose or business purpose?

- Individual borrower
- Refi a loan secured by 6 unit multi family housing
- one 1 unit (same size as other 5 units) is occupied by borrower as residence whole year

If the borrower is a business entity like LLC, is it considered a business purpose?

There are a few different exemptions from Regulation Z. One is for business purposes and another (technically the same exemption) is for "organizational credit." Your illustration does not (clearly) tell us what the purpose of the loan is, so we can't determine if it is for for business purposes. (You tell us what they are doing with the funds, but not why they are doing it.)

That said, since the loan is to an LLC, it would be considered organizational credit and is exempt from Regulation Z.

The commentary explains the organizational credit exemption:
"9. Organizational credit. The exemption for transactions in which the borrower is not a natural person applies, for example, to loans to corporations, partnerships, associations, churches, unions, and fraternal organizations. The exemption applies regardless of the purpose of the credit extension and regardless of the fact that a natural person may guarantee or provide security for the credit.

The purpose of refinancing the loan was both for investment and household purpose, as one unit is actually occupied by the borrower for primary residence. I think the primary purpose of the loan is though investment by the percentage wise.

Just to be sure, if a loan meets the TILA 1026.3(a)5 exemption requirements for OO rental property, then it is exempt from TILA, so also exempt from TRID, correct?

If exempt from Regulation Z - it is exempt from all of it.

We have a file- 3 family, investment, not a consumer purpose. However, when the Credit Dept. was doing their analysis, Credit is asking now the customer to pay their debts out of proceeds. Which makes it now a consumer purpose loan. I am not sure if we can proceed with the existing file, because TRID disclosures were not disclosed. Can we withdraw and re-submit as a consumer loan, but what reason can we use for the withdrawn file?

Sounds like (if I understand) you are making a counter-offer to the customer that requires them to pay down personal debt in order to obtain the loan. If that is the case, then when the applicants say - yes, I would like to proceed with the counter-offer, that would be the date that the application turned into a consumer loan application if its purpose actually changed.

Of course, that does not answer the question as to what the purpose for the loan was originally and whether making them use some of the proceeds for the payment of personal debt will still fulfill the original purpose. If it does, then I am not sure that any of this actually changes the underlying original purpose of the loan.