Kind of a strange situation. We have a 2nd D/T term loan on O/O CRE. We are consolidating debt by doing a CIT and increasing the loan amount. One of the loans we are paying off is on an SFR. I know that the loan is not HMDA reportable as a CIT, but is it CRA reportable since we are refinancing Residential RE? My gut says yes and to just report it as CRA (there is no Res collateral, just the office buidling). I wanted to check with the experts to see if they agree. Any help would be much appreciated! Thank you!

If the primary (>50%) collateral is the office building, the loan can be a small business type 1, assuming the amount is $1 million or less.

You have to walk through the HMDA steps to ensure the loan is not HMDA reportable...paying off a dwelling secured loan with a dwelling secured loan, loan to same borrower, collateral need not be the same dwelling.

If it is HMDA reportable, and is a business purpose loan refinancing a business purpose loan, and is not primarily secured by residential real estate (as described above), then it can still be a CRA Type 1 small business loan as a refinance. Refer to the CRA q and a for the refinance exemption for double reporting.

Thank you Kathleen. You have calmed my fears! Sincerely appreciate it!!

CRA/HMDA Guy. I disagree with Kathleen. If you have a dwelling secured loan paying off a dwelling secured loan, to same borrower(collateral need not be the same dwelling). That is the mere definition of HMDA refinance. It does not matter if the dwelling is not the primary collateral. It is only HDMA because of the dwelling. I am not familiar with the Q and A for the refinance exemption for double reporting.

The primary collateral has nothing to do with HMDA. It is a determining factor for where to place a small business refinance for CRA, type 1 or type 3. Small refinances can be both CRA and HMDA.