It is Friday and my brain is tired of compliance but I have a compliance question. We have a con/perm loan for a customer and reported it on our LAR. Now the customer wants a 60 day loan for cost overruns, secured, interest only. Would we report the 2nd loan as a purchase or home improvement on our LAR?

If it is for cost overruns to complete the construction, it would be reported as a purchase.

Does temporary financing come into play at all since it is a 60 accural loan? The customer intends to convert the loan to a HELOC. We do not report HELOC's.

If the loan is going to be paid off by other financing arrangements, then the loan would be considered temporary and would not be reportable.