HELOC

We have multiple consumer HELOC's where the borrower is planning to use it for business expenses.

Would the HMDA need to marked primarily business purpose? I was tripped up because these are on consumer HELOC's, not commercial open-end lines, and secured by principal residences.

If they are primarily for a business purpose then that is what they should be coded for HMDA purposes.

My next comment would be why would a "business" purpose revolving line of credit be booked on a consumer based note? Even though this may be a business purpose loan you most likely have priced as a consumer loan due to the HELOC classification and if something goes wrong you are very limited in being able to suspend or terminate the line of credit due to the consumer protection limitation built into the consumer loan agreement.

We are working on that now to prevent it happening again.

I do have a follow-up question if you don't mind as well. In the scenario above, the HMDA purpose is other... Would we be obligated to report this since it is under a consumer note even though it is a commercial, other purpose?

No. A business purpose loan that is not for purchase, refi, or HI is not reportable.