The commercial loan dept. makes loans to Condo Trust groups. The tenants actually own individual condos. The loan is to the trust for paving lots and grounds work. HMDA reportable? I think no, but need some help finding the answer in HMDA getting it Right.

Thanks much in advance!

Why do you think no? Sounds like a loan secured by a dwelling(s) for the purpose of home improvement, therefore meeting the definition of a home improvement loan.

If the loans are not secured by a dwelling then they would also need to be classified as a home improvement loan to be reportable.

K8T, it sounds like you think to who the loan is to controls HMDA.

HMDA is primarily controlled by the collateral, is it secured by dwellings, i.e., 1-4, apartment buildings, condos, etc. and then it is secondarily effected by the purpose, i.e., to purchase a dwelling(s), to improve the dwelling(s), and refinancing dwelling secured loans.

As Dan said “sounds like a loan secured by a dwelling(s) for the purpose of home improvement.”

I don't think it is HMDA reportable because the loan is not secured by the condos- the TRUST doesn't own the condo's just the land the condos are on-

If the loans are non-dwelling secured and they are not classified as home improvement loans then they would not be reportable.

Question Dan, If the bank normally classifies loans as home improvement when they are not secured by RE, thus making them reportable but doesn't classify a loan like the one above because they didn't "think" it was HI, then wouldn't it still be HI and need to be reported as such?

If you normally classified non-dwelling secured HI loans as such and if you mis-classify a loan request then yes I would agree with you.

Showing inconsistency in classifying one loan as HI and not classifying another similar loan as HI will waive red flags at your examiners.