We received an application for a consumer construction to permanent loan. We do not offer this type of credit. We only offer construction only loans to consumers. The lender sent a Adverse Action Notice/Counteroffer and countered a construction only product. The applicant did not accept.

Do we report the original application on our HMDA LAR? I am thinking no since we do not offer that type of credit/product that was requested. Additionally, we would have no terms to report such as loan term and introductory period, etc.

I am confused. You mean they applied for a 1x close construction/permanent loan? A construction to permanent loan is usually taking out an existing construction loan and making it into permanent financing.

If you do not offer 1x close construction/permanent loans, then they applied for a product you do not offer and it is not adverse action. In fact, it is not even treated as an application

1002.2(c)(v) A refusal to extend credit because the creditor does not offer the type of credit or credit plan requested.

Yes, I mean a 1x close construction/permanent loan. We do not offer that. Thanks for the help!