Answer:
Because proceeds of your loan are being used for the property transfer, that makes this loan subject to RESPA; therefore, early disclosures will apply. See 3500.5(b)(3).
First published on BankersOnline.com 2/7/05
Early Disclosures on Purchase/Construction?
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Question:
Are early disclosures required on a construction loan to an individual? The bank loan would be for construction only. Permanent financing is being provided by another lender. The first draw on the loan will transfer the lot (purchase money) into the borrower's name.
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