Reporting Occupancy

Answered by:

Question:

A consumer purpose loan was originated to consolidate the borrower's credit card debt. The loan is secured by the principal dwelling of the borrower's parents. The parents are not borrowers on the loan and the borrower is not on the deed to the property. What is the occupancy type for this loan?

Answer:

The collateral is reported as "Investment" because it is not the borrower's principal or second residence. That situation will always be "Investment" for HMDA. Investment does not mean only rental properties for HMDA reporting.

There are only 3 HMDA occupancy choices:

"Whether the property identified in paragraph (a)(9) of this section is or will be used by the applicant or borrower as a principal residence, as a second residence, or as an investment property."

-------------------------
Learn more about Kathleen Blanchard’s, Key HMDA Concepts and Research Tips webinar.