Call Report Code for Purchased Property & Homestead

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Question:

Customers of ours purchased the property adjacent to their homestead. There is a small workshop, approximately 1200 sf with a bathroom on the property. We have the first lien on these lots but another financial institution has the first lien on their homestead. What call report code do we use? Can we use 1c(2)a, 1-4 family, if the residence is next door? Should we use 1a(2), for land development and all other land loans?

Answer:

The bank should determine what collateral provides the primary collateral for the loan and code accordingly.

First published on BankersOnline.com 9/17/12