[Mary Beth Devillier]

I have a loan for a business entity that is mortgaging their investment 1-4 dwelling for the purpose of reimbursing themselves for renovations to 1-4 family investment listed for sale. Is this loan HMDA reportable as Home Improvement or no? The loan officer did not complete HMDA for this loan and I am reviewing it and kind of think it might be reportable.

Topic

[Kimberly Boatwright, CAMS, CRCM]

Based on the information you provided. Yes, this loan is likely HMDA reportable as a home improvement purpose transaction under Regulation C (12 CFR Part 1003).

Home Improvement Definition: Under HMDA, a home improvement-purpose transaction is one where the proceeds are used to improve a dwelling or the real property on which it is located.
Reimbursement: Using loan proceeds to reimburse the business entity for past renovations on a 1-4 family dwelling qualifies as a home improvement purpose, as long as the stated intent/use of the funds ties back to improving the dwelling. The fact that the property is listed for sale does not exempt it from home improvement classification.

NOTICE: This email message, including any attachments, is intended only for the addressee, and may contain confidential and privileged information either as protected work product or confidential client information. Any unauthorized review, use, disclosure or distribution is prohibited. If you are not the intended recipient, do not read, copy, retain, or disseminate this message or any attachment, and please contact the sender by reply e-mail or at 888.760.5646 and destroy all copies of the original message and attachments. Neither the transmission of this message or any attachment, nor any error in transmission or misdelivery shall constitute waiver of any applicable legal privilege.

THIS EMAIL AND ITS ATTACHMENTS DO NOT CONSTITUTE LEGAL ADVICE

[Author]

Replies