EARLY TIL on a Construction Loan

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Question:

If a borrower is in title to property and we are doing a construction loan 12 months or under, are we required to do an early TIL?

Answer:

Early disclosures are required under 226.19(a) when you have a residential mortgage transaction (a transaction in which a mortgage, deed of trust, purchase money security interest arising under an installment sales contract, or equivalent consensual security interest is created or retained in the consumer’s principal dwelling to finance the acquisition or initial construction of that dwelling.) subject to RESPA.

While it sounds like your customer owns the dirt, the loan is for the original construction.

First published on BankersOnline.com 6/17/02