RESPA, Secondary Collateral, and Farm Land

Answered by:

Question:

When a residence is secondary collateral on a loan for farm land that is more than 25 acres, does RESPA apply? The residence is located separately from the farm land.

Answer:

Answer by David Dickinson:

No. 24 CFR 3500.5 indicates that any loan secured by 25 acres or more is exempt from RESPA. The home doesn't have to be on the > 25 acre portion.

Answer:

Answer by Lucy Griffin:

I agree. The 25 acres gets the entire transaction out from under RESPA.

First published on BankersOnline.com 2/24/03