We believe that an unsecured loan would be exempt from the higher-priced loan requirements, the RESPA rules, and the HMDA requirements (which are contained in Section X of Fannie Mae’s Uniform Residential Loan Application form). All three regulations apply only to loans that are secured by certain types of properties, as explained below, and therefore would not apply to an unsecured loan.

• Regulation Z’s higher-priced loan requirements apply only to loans “secured by the consumer’s principal dwelling.” 12 CFR 1026.35(a). (This will still be the case after the CFPB’s amendments to these provisions go into effect on June 1.)

• RESPA applies only to loans “secured by a first or subordinate lien on residential real property.” 24 CFR 3500.5(a)24 CFR 3500.2(b) (definition of “federally related mortgage loan”).

• Similarly, Regulation C applies only to loans “secured by . . . a dwelling.” 12 CFR 1003.1(c) (scope); 12 CFR 1003.2 (definitions of “home purchase loan,” “home improvement loan,” and “refinancing”).

Further, note that all of the regulations discussed above exempt temporary financing from their requirements. 12 CFR 1026.35(a)(3) (Regulation Z higher-priced mortgage loan provisions); 24 CFR 3500.5(b)(3) (RESPA); 12 CFR 1003.4(d)(3) (HMDA). While none of these regulations define the term “temporary financing,” the FFIEC’s HMDA FAQs provide a useful explanation of the term (under Temporary Financing):

[F]inancing is temporary if it is designed to be replaced by permanent financing of a much longer term. A loan is not temporary financing merely because its term is short. For example, a lender may make a loan with a 1-year term to enable an investor to purchase a home, renovate it, and re-sell it before the term expires. Such a loan must be reported as a home purchase loan.