Never run into this before: I have a 12 month, commercial, revolving line of credit secured by a dwelling. The purpose of the line is to take the funds and build a rental home one a separate piece of property. The plan is for the line to be paid down once the rental is built through the sale of other real estate. The line will remain open (and renewed every 12 months) to be used as working capital.
I don't think the construction exemption would apply, because this line is not exclusively for construction: A construction only loan or line of credit is considered temporary financing and excluded under Regulation C if the loan or line of credit is extended to a person exclusively to construct a dwelling for sale.
With that being said, is 'construction' considered a "purchase," if done outside of the construction exemption? Or would this just not be reported?