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I have a loan in a LLC entity name borrowing funds to reimburse purchase and renovation of 1-4 family investment property to pay line of credit to zero. This loan is secured with 1-4 family investment property and the line of credit we are paying to zero (not closing) was secured with 1-4 family investment property in the same LLC entity name. I’m just trying to make sure of my HMDA purpose as purchase, due to the hierarchy of reporting purposes for business loans. Am I thinking of this correctly?
Purchase is only used if any of the funds will be used to purchase a property. If I’m understanding your scenario, the purchase was already completed, it sounds that you have a refinance and not a purchase.
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Good Morning, I just want to make sure that the above scenario is considered a refinance even though the previous loan (line of credit) is not being closed but is being paid to zero.
Based on the scenario you have outlined in the first question you do not have a purchase. If what you are indicating is that the funds are being refinanced into a new loan it sounds as if you have a refinance as written into the original question.
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