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#2268671 - 04/05/22 01:58 PM LOC for Future Investments
jel99 Offline
Junior Member
Joined: Sep 2021
Posts: 48
I have a couple loans appear on our LAR that I was hoping the forum could allow some input on my interpretations.

Scenario 1: Business open-end line with sole intention to acquire future investment properties. I would assume that the HMDA purpose would be Home Purchase since the loan will be providing the borrower, in whole or part, to purchase property. Is this a correct interpretation?

Scenario 2: A consumer HELOC with stated purpose "to use funds for future investments." Since the "investment" itself is not clear, is this safe to interpret as an "other" purpose?

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#2268710 - 04/06/22 01:28 PM Re: LOC for Future Investments jel99
Dan Persfull Offline
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Dan Persfull
Joined: Aug 2002
Posts: 47,517
Bloomington, IN
#1. I agree.

#2. Since you have information the LOC is for future investments you need to determine what those investments are. IMO you can't just throw the "other" category at it without doing your due diligence.
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The opinions expressed are mine and they are not to be taken as legal advice.

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#2268746 - 04/06/22 06:03 PM Re: LOC for Future Investments jel99
John Burnett Offline
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John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
#1 - assuming the investment properties are dwellings, I also agree. But if the borrower is investing in strip malls, no HMDA

#2 - I agree with Dan.
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