Question:
We have a commercial loan transaction where the borrower is purchasing a commercial building and repurposing it into 18 residential condos. Is this loan HMDA reportable?
Answer:
Unfortunately, the regulation does not specifically address the situation of a non-residential building is being converted to a dwelling after consummation. While there is an argument that this is not a “dwelling” at consummation, in grey areas, we’d generally interpret that it’s more conservative to report than not. So the bank may choose to report this to be on the safe side, but whichever way it chooses, it should document its reasoning and apply it consistently to any similar situations that may come up in the future.
Compliance Alliance offers a comprehensive suite of compliance management solutions. To learn how to put them to work for your bank, call (888) 353-3933 or email info@compliancealliance.com.
Not a member? Learn more about membership with Compliance Alliance by attending one of our live demos:
Compliance rules and regulations change quickly! For timely compliance updates, subscribe to Compliance Alliance’s email newsletters.
