Question: We have two borrowers who are requesting to refinance a loan secured by one of the borrower’s principal residences, but the purpose of the cash out will be to pay off a lien on a different residence that is only in one of the borrowers’ names. For HMDA purposes, should I report this as a Refinance since both liens are in one of the borrower’s name even if it’s not the same property?
Answer: Yes, that is correct since the HMDA definition of refinancing does require that at least one of the borrowers be the same but does not necessarily require that the dwelling securing the loans be the same:
“Refinancing means a closed-end mortgage loan or an open-end line of credit in which a new, dwelling-secured debt obligation satisfies and replaces an existing, dwelling-secured debt obligation by the same borrower.”
12 CFR 1003.2(p): https://www.consumerfinance.gov/rules-policy/regulations/1003/2/#p
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