[Anonymous]

Does the purpose for TRID need to follow the pecking order as laid out in the guide or is it based on where the greater portion of the loan proceeds are going?
Example: Loan amount $475,000
$125,000 – Paying off a current construction loan at another bank – Refinance
$350,000 – to complete construction of the SFR – Construction

Would the purpose be Refinance or Construction?

Thanks!

Topic

[rcooper]

You only disclose “construction” for construction-only or construction-to-permanent transactions. If a construction loan is also for the purpose of purchase or refinance (as defined in 1026.37) as well as construction you would disclose the purpose as purchase or refinance, respectively.

[Author]

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