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#631240 - 10/30/06 04:13 PM HMDA questions
ACBbank Offline
Power Poster
ACBbank
Joined: Jul 2006
Posts: 4,352
New York City
A construction line of credit is being considered by my FI. Currently, the land is vacant, but if the terms are accepted, a 1-4 Family home will be built. Line term is one year. HMDA reportable?

One more question, Im curious as to how other FI's are classifying construction of residential homes on their LAR. I have heard of an FI close to mine classifying them as Home Improvement Loans, and I was wondering what others across the nation are doing. Thanks.
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"100 victories in 100 battles isnt the most skillful. Subduing the other's military w/o battle is the most skillful." Sun-Tzu

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Lending Compliance
#631241 - 10/30/06 04:16 PM Re: HMDA questions
COMPLIcated Offline
Diamond Poster
Joined: Mar 2003
Posts: 1,035
OK
We are excluding these from our LAR under the examples of temporary financing in HMDA. If we do a permanent loan for it then we do report those on our LAR as a Home Purchase.

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#631242 - 10/30/06 05:27 PM Re: HMDA questions
Dan Persfull Offline
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Dan Persfull
Joined: Aug 2002
Posts: 47,535
Bloomington, IN
Construction only loans are not reportable. Construction/permanent loans are reportable. You have the option to report at the time the construction phase begins or when it converts to permanent financing.

Construction/permanent loans and the loans that replace a construction only loan are reported as home purchases, not home improvements.
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The opinions expressed are mine and they are not to be taken as legal advice.

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#631243 - 10/30/06 04:18 PM Re: HMDA questions
ACBbank Offline
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ACBbank
Joined: Jul 2006
Posts: 4,352
New York City
Quote:

We are excluding these from our LAR under the examples of temporary financing in HMDA. If we do a permanent loan for it then we do report those on our LAR as a Home Purchase.



I was leaning in that direction too, but wanted to get some input on it. Any one else?
_________________________
"100 victories in 100 battles isnt the most skillful. Subduing the other's military w/o battle is the most skillful." Sun-Tzu

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#631244 - 10/30/06 04:19 PM Re: HMDA questions
ACBbank Offline
Power Poster
ACBbank
Joined: Jul 2006
Posts: 4,352
New York City
Quote:

Construction only loans are not reportable. Construction/permanent loans are reportable. You have the option to report at the time the construction phase begins or when it converts to permanent financing.


Construction/permanent loans and the loans that replace a construction only loan are reported as home purchases, not home improvements.



Thanks Dan.
_________________________
"100 victories in 100 battles isnt the most skillful. Subduing the other's military w/o battle is the most skillful." Sun-Tzu

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