Early Disclosures for Down Pay on Primary Res?

Answered by:

Question:

The purpose of the loan is to provide funds to place a down payment on a primary residence. The collateral is a second on a residential property that they rent out. They plan to sell their current primary residence. Term is a 36/180 balloon. Do early disclosures apply?

Answer:

What is your basis for exemption? It meets the definition of a home purchase (dwelling secured loan for the purchase of a dwelling), it is not temporary financing (36/180 balloon) therefore it meets the definition of a federally related mortgage loan subject to RESPA and it's for a consumer purpose and is therefore subject to Reg. Z.

First published on BankersOnline.com 7/23/12