I have a $36,000 loan that will be secured by a 2nd Mortgage and a CD which will be used for debt consolidation ($24,000) and to purchase a playground set ($12,000 -- yes, I said $12,000). This loan refinances an existing loan at our bank which was only secured by a CD. We will not be coding this on our system as a home improvement loan as we list the purpose of the majority of the funds (i.e. debt consol). The docs do list the purpose as debt consol & purchase playground set. Should I report this as a home improvement loan ....wasn't sure how HMDA viewed a playground set....it is an improvement but it can also be removed. If we do report it as home improvement, do I have to report is on my system as home improvement to qualify?

If ANY portion of the loan funds are used for HI purposes and is secured by a dwelling then the loan is a HI loan regardless how you classify the loan.

What you have to determine is if the playground set is an improvement to the dwelling or the real property on which the dwelling is located.

You say the playground set could be removed, at that price it has to be an extensive set and I would venture there are several "anchoring systems" in place, so how likely will it be that the set would taken if the property is sold. That's what you need to determine.

I have a similar playset from the same company but mine wasn't nearly that much! It is anchored to the ground and I would probably leave it with the house if I ever sold it unless the new buyer wanted it taken down and then I would do so. I guess I'll be safe and go ahead and report it to HMDA as it is unlikely it would be removed. Thanks for your input as always!