And here's another question - I have a call in on this one, but it illustrates WHY HMDA is so frustrating, and WHY a lot of the HMDA data is not relevent:

How should this loan be reported?
Home Equity loan secured by customer's Primary Residence. The purpose of the loan was to refinance a Mobile Home that the customer uses as a vacation home BUT the Mobile Home does NOT secure this loan.

So - do I report this as Owner-Occupied or Non-Owner Occupied? And what location do I report - the location of the home we took as collateral - or the location of the Mobile Home?

I am GUESSING that this would be reported as non-owner occupied and the location would be the mobile home (located out of state next to a river on Indian land!) but the fact that the loan is SECURED by the primary residence is thowing me off a little.

Your answer can be found in Appendix A of Regulation C paragraph V.C.--For home purchase loans (which include refinancing under Regulation C) secured by one dwelling, but made for the purpose of purchasing/refinancing another dwelling, report the property location for the property in which the security interest is to be taken. That would mean you would also report it as owner-occupied.

If I am reading this correctly!!

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JoAnne

Opinions posted are not necessarily those of my employer.

[This message has been edited by JoAnne (edited 12-12-2001).]

Then here's the part that gets me - A couple years back, I reported the following loan:

Equity Loan secured by borrower's Primary Residence. The purpose of the loan was to purchase a Mobile Home that the borrower intended to move into and make her primary dwelling so that her daughter and family could move into the house.

I reported the loan based on the address of the primary residence and reported the loan was an Owner-Occupied purchase.

The examiner told me that was incorrect. The reason was since the borrower was already living in the house at the time the loan was made, the Mobile Home was Non-Owner occupied.

So - in order to report THAT loan correctly, I needed to report a purchase loan, based on the existing home's address, and show the loan as Non-Owner Occupied. ?? :O ??

You know, the more I think about it, the more it seems that HMDA is like sausage. All the various governmental and activist groups love to chew up the results, but they certainly wouldn't want to see what goes into the making of it!!!!

[This message has been edited by Bonnie M (edited 12-12-2001).]

[This message has been edited by Bonnie M (edited 12-12-2001).]

[This message has been edited by Bonnie M (edited 12-12-2001).]

[This message has been edited by Bonnie M (edited 12-12-2001).]

One thing to remember is that HMDA is PURPOSE driven, not collateral driven. If a customer borrows $5,000 unsecured to improve his house, it is still a HMDA loan. Owner occupied, since the money went for the house he lives in.

Appendix A - V A.-6. says "indicate whether the property to which the loan application relates is to be owner occupied..."

Again, under Appendix A V C. Property location says to enter the MSA codes for "the property to which the loan relates."

So your situation would be the Purpose is for the MH, not the residence, so HMDA reporting would be the MH address, non-owner occupied, since he is not in it enough to establish residency.

[This message has been edited by Nanwa (edited 12-13-2001).]

Well the unsecured loan is reportable IF you classify it as a Home Improvement loan. The HMDA proposal out there seeks to return to the days when we had to guess if the loan was for Home Improvement based on what the applicant wrote for "purpose." So, if your customer writes "repairs", you get to decide what it is he/she is seeking to repair - their house, their car, plastic surgery?

The other possibility is to have a question that asks "Will this loan be used to improve your home or another dwelling? - [ ] Yes [ ] No.

But I guess the confusing part is reporting the location of the loan. The HMDA instructions state that for a PURCHASE loan - if the loan will be secured by a property other than the one being purchased then you should report the location of the collateral property.

It doesn't say anything about a refinance. Logically, if a purchase loan would be reported by the collateral address then the same rules would apply to a refinance. But Logic and HMDA are two terms that do not necessarily belong in the same sentance.