(1) Loan is to Farmer Jones - DBA Jones'Farming. Farmer's accountant instructed to set-up this way.(2) Purpose is to construct principal residence.(3)Collateral is 208 Acre farm and residence being constructed.(4) I consider this loan as "consumer purpose" and am requiring TIL disclosures. (5) Agree or disagree?

Agree, there is no agricultural purpose and Reg. Z does not exempt loans based on acreage as RESPA does. This would also be a reportable home purchase loan for HMDA when the loan goes to permanent financing.

Does Jones' Farming have a separate TIN? If so, I would think then the loan is not to a natural person and wouldn't be subject to Reg Z. I could be wrong though - I don't usually disagree with Dan.

In my mind, there is no separation between the individual and the individual acting as a DBA. Whether or not the dba has a separate EIN would not matter. This is clearly not a business purpose loan. Why his accountant has suggested this is beyond me.

You are correct Deena, but normally a person operating as a DBA will be operating under their SSN. Unless the DBA is set up as its own entity I'm not sure how you could say you were not lending to a natural person.

I agree with the "normally" part, but we have situations where there is a separate TIN for the DBA. I realize it's a technicality and that this is clearly consumer purpose, I'm just thinking that if it's not to a natural person, it's not subject to Reg Z.

It is best for a d/b/a/ to obtain a TIN when they have empolyees.

Let me give you another example of a person living at the business. Let’s say I own storage buildings where customers can store the goods in enclosed, locked storage units and can also store their boat, RV, etc. I decide to live on premises to act as security. Your loan is to build the home where I will live and is owned by the business. The business is incorporated, and I am the sole stockholder. Is the construction of my home consumer or business?

The fact that it is incorporated should not be the determining factor since I can have a business in my own name. They are both businesses.

Also, TIL eliminates ag purpose loans. Is the acreage for ag purposes, and I just live there?

§ 226.3 Exempt transactions.
This regulation does not apply to the following:
(a) Business, commercial, agricultural, or organizational credit.
(1) An extension of credit primarily for a business, commercial or agricultural purpose.
(2) An extension of credit to other than a natural person, including credit to government agencies or instrumentalities.

If an individual is purchasing a farm, that includes a farm house, I don’t think Reg Z applies. I think it is the primary purpose of the loan that will govern. So, building a farm house on a farm is that consumer?

This is an interesting argument. However, I tend to disclose and ask questions later. If it was not required, no big deal, and if it was, I saved my tail.

But it is interesting to discuss.

I would refer to the OSC - based on that, the construction of a new primary residence on farm land does not appear to meet the ag definition:

Agricultural purpose. An agricultural purpose includes the planting, propagating, nurturing, harvesting, catching, storing, exhibiting, marketing, transporting, processing, or manufacturing of food, beverages (including alcoholic beverages), flowers, trees, livestock, poultry, bees, wildlife, fish, or shellfish by a natural person engaged in farming, fishing, or growing crops, flowers, trees, livestock, poultry, bees, or wildlife. The exemption also applies to a transaction involving real property that includes a dwelling (for example, the purchase of a farm with a homestead) if the transaction is primarily for agricultural purposes.