Loan has a term of 12 months and is interest only. They calculated the cash flow using a 15 year amortization. My guess is they anticipate it being paid off when the subject property and the other properties are sold to the investor for the townhome development, but they wanted to play worst case scenario just in case the deal didn't finalize and the borrower needed to refinance the debt with a 15 year term.
If the Abundance of Caution didn't involve a lien being recorded, I would not consider putting it on the HMDA LAR, but with the lien, I feel I must consider it.
The next question is, "Does this loan qualify as a "Bridge Loan/Temporary Financing?" I do not believe it does, because the hopes/expectations do not come off as being guaranteed; thus, I feel it should be on the LAR. Do you agree?
Last edited by pp1865; 08/05/21 04:17 PM.