Posted By: bgehres
HMDA Use of Proceeds - Purchase or Refinance? - 08/08/05 08:53 PM
If a customer buys a rental property using a HELOC and then applies for a loan to pay down the HELOC secured by the rental property, what would this by classified as for HMDA?
Posted By: Anonymous
Re: HMDA Use of Proceeds - Purchase or Refinance? - 08/08/05 09:05 PM
A refinance since there is a dwelling on both sides of the transaction.
Posted By: bgehres
Re: HMDA Use of Proceeds - Purchase or Refinance? - 08/09/05 02:02 PM
Since the HELOC line is on the person's primary residence, you wouldn't pay off the HELOC, so therefore, I agree it wouldn't be a refinance, but in essence, they are using the funds to purchase the property, just no directly through that transaction. Does this matter?
Posted By: Dan Persfull
Re: HMDA Use of Proceeds - Purchase or Refinance? - 08/09/05 02:23 PM
The proceeds of this loan are not being used to purchase a property - they are being used to pay down a line of credit which was used to purchase the property.