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#971490 - 06/09/08 02:49 PM Specific Purpose Required?
terpsfan Offline
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I know we have to get a purpose for non real estate loans over 10,000 and should get it on real estate loans for HMDA purposes but what about loans under 10,000 that are not secured by real estate? Also we do report home improvement loans that are non real estate secured. I see alot that say personal and purchase but dont say what they are purchasing. Also some say refinance but there is a sizable cash out that goes with out a documented purpose.

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Lending Compliance
#971534 - 06/09/08 03:41 PM Re: Specific Purpose Required? terpsfan
ACBbank Offline
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Getting the purpose on any loan is just having a sound lending practice in place IMO. How could you approve a loan, for any amount of $, w/o knowing the purpose?

HMDA is applicable to loans secured by a residential dwelling. If its not secured by a dwelling, I highly doubt HMDA is applicable.
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#971586 - 06/09/08 04:35 PM Re: Specific Purpose Required? ACBbank
Dan Persfull Offline
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Bloomington, IN
Terpsfan states they report non-dwelling secured home improvement loans, which to me would mean they classify such loans as HI loans therefore those loans would be subject to HMDA.

Outside of sound lending practice as ACBank alludes to there is no requirement to get the purpose of the loan for loans under $10,000. However, if you are a HMDA bank you are required to report certain type loans, therefore if you don't get the loan's purpose how can you effectively comply with reporting requirements?
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#971590 - 06/09/08 04:37 PM Re: Specific Purpose Required? Dan Persfull
ACBbank Offline
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New York City
Originally Posted By: Dan Persfull
Terpsfan states they report non-dwelling secured home improvement loans, which to me would mean they classify such loans as HI loans therefore those loans would be subject to HMDA.


Good catch Dan. I forgot about classifying loans as HI provision.
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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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#971615 - 06/09/08 04:59 PM Re: Specific Purpose Required? ACBbank
Skittles Online
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TN
I do agree with ACBbank - I train to always get a purpose for a loan. Now, do they do it all of the time - NO!
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