I have a commercial loan for funds to build a rental. The property they are building it on is currently owned by the borrowers. They are using an existing rental as collateral. So not HMDA reportable right? Not a purchase, not a refi, and not a home improvement since it will be from the ground up. It has been a long week!

It would qualify as a purchase unless it's a temporary loan. Is the loan structured as construction only with a perm loan to follow (not reportable...but the perm loan to follow would be) or is it construction-perm all in one (reportable)?

ETA: add clarifying point about perm loans.

3. Construction and permanent financing. A home purchase loan includes both a combined construction/permanent loan or line of credit, and the separate permanent financing that replaces a construction-only loan or line of credit for the same borrower at a later time. A home purchase loan does not include a construction-only loan or line of credit that is designed to be replaced by separate permanent financing extended by any financial institution to the same borrower at a later time or that is extended to a person exclusively to construct a dwelling for sale, which are excluded from Regulation C as temporary financing under § 1003.3(c)(3). Comments 3(c)(3)-1 and -2 provide additional details about transactions that are excluded as temporary financing.


I think people read this definition and sort of assume it's talking about consumers constructing their primary residence, but there's nothing in it that says that.

Thank you raitchjay. Just needed direction.