Question: We have this HMDA question. We have a customer who was in a Contract for Deed situation. The loan(s) are secured by a dwelling purchased from this Contract for Deed. The first lien is for the purchase price and improvements. The improvements are building a shed on the property, the total of which exceeded the first mortgage loan amount The second mortgage covered the overage. How would this situation be reported for HMDA?
Answer: From what you have described, the first would be reported as a purchase and the second would be home improvement (since all of the proceeds are being used for home improvement and none for purchase).
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