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If loan has multiple pieces of collateral each with dwelling units, do you add them all together for reporting?
Ex. 2 duplexes = 4 units, even if one of the buildings is a cross-collateralization?The wording in commentary to 1003.4(a)31 and (a)9-2 is driving us crazy!
Hi Send2k1! You would report all of the units that secure the loan for 1003.4(a)(31), not just for the property identified on the LAR. I bolded text in the excerpts below to help explain. I hope that answers your question. If not, please let us know. Thanks!
1003.4(a)(31) states:
The number of individual dwelling units related to the property securing the covered loan or, in the case of an application, proposed to secure the covered loan.Official Interpretation
Paragraph 4(a)(31)
1. Multiple properties. See comment 4(a)(9)-2 regarding transactions involving multiple properties with more than one property taken as security.And 4(a)(9)-2 states:
Multiple properties with more than one property taken as security. If more than one property is taken or, in the case of an application, proposed to be taken as security for a single covered loan, a financial institution reports the covered loan or application in a single entry on its loan/application register and provides the information required by § 1003.4(a)(9) for one of the properties taken as security that contains a dwelling. A financial institution does not report information about the other properties taken as security. If an institution is required to report specific information about the property identified in § 1003.4(a)(9), the institution reports the information that relates to the property identified in § 1003.4(a)(9) (or, if the transaction is partially exempt under § 1003.3(d) and no data are reported pursuant to § 1003.4(a)(9), the property that the institution would have identified in § 1003.4(a)(9) if the transaction were not partially exempt). For example, Financial Institution A originated a covered loan that is secured by both property A and property B, each of which contains a dwelling. Financial Institution A reports the loan as one entry on its loan/application register, reporting the information required by § 1003.4(a)(9) for either property A or property B. If Financial Institution A elects to report the information required by § 1003.4(a)(9) about property A, Financial Institution A also reports the information required by § 1003.4(a)(5), (6), (14), (29), and (30) related to property A. For aspects of the entries that do not refer to the property identified in § 1003.4(a)(9) (i.e., § 1003.4(a)(1) through (4), (7), (8), (10) through (13), (15) through (28), (31) through (38)), Financial Institution A reports the information applicable to the covered loan or application and not information that relates only to the property identified in § 1003.4(a)(9).
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