No, there are no provisions in the MEAA that outline the criteria for a property to be considered “owner occupied,” and we are not aware of any court cases that have clarified MEAA’s “owner occupied” requirement.

In order to comply with MEAA, then, your bank will have to establish its own method to determine the primary purpose and use of the residence. In doing so, you may wish to use the Official Interpretations of Regulation Z, which provide that a rental property cannot be considered non-owner occupied “if the owner expects to occupy the property for more than 14 days during the coming year.”

For resources related to our guidance, please see:

• Mortgage Escrow Account Act, 765 ILCS 910/4 (“On or after the effective date of this Act, each mortgage lender in conjunction with the granting or servicing of a mortgage on a single-family owner occupied residential property, shall comply with the provisions of this Act.”)

• Regulation Z, Official Interpretations, 12 CFR 1026, Paragraph3(a), Comment 4 (“Credit extended to acquire, improve, or maintain rental property (regardless of the number of housing units) that is not owner-occupied is deemed to be for business purposes. This includes, for example, the acquisition of a warehouse that will be leased or a single-family house that will be rented to another person to live in. If the owner expects to occupy the property for more than 14 days during the coming year, the property cannot be considered non-owner-occupied and this special rule will not apply. For example, a beach house that the owner will occupy for a month in the coming summer and rent out the rest of the year is owner occupied and is not governed by this special rule. (See comment 3(a)-5, however, for rules relating to owner-occupied rental property.)”)