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While checking the recent updated list of Rural or Underserved areas, we noticed that one of the census tracts in our county is no longer on the list. 3 of the 4 census tracts in our county are still on the list. I have been trying to piece together all the regulations that this may effect. I know that we must originate a first lien mortgage in a rural or underserved county to be able to originate Balloon Payment QM’s and to be eligible for the HPML Escrow exemption. I also know that this effects whether we are required to get a second appraisal on an HPML flip loan (which I think is loan specific, not just if you originate 1 loan in a rural or underserved area. My questions are: 1. Are there any other regulatory burdens we will face by originating a loan in the census tract that is no longer on the list of Rural/Underserved; and 2. If there is a “flip” loan in that census tract, are we required to get the second appraisal and not charge the customer? Thanks for your help!
1. I can’t immediately identify any other requirements impacted by the rural or underserved lists.
2. Generally compliance with a particular requirement is determined at the time the loan is made. If the loan was located in a rural track at the time the loan was made then the second appraisal would not be required. If the area subsequently losses it “rural’ designation after consummation there is no requirement to go back and obtain a second appraisal.
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