Can someone confirm for me regarding RESPA and early disclosures for construction loans?
1) Construction loan (12 months) – to be re-financed / sold on the secondary market at the end of loan – early disclosures are NOT required.
2) Construction loan (12 months) – to be re-financed into long term by our institution – early disclosures ARE required.
3) Construction loan (12 months interest only) – no mention of long-term financing is made in the loan file – are early disclosures required?
My opinion is that if you don’t have a firm take out commitment from another lender for the permanent financing, then the loan “may be converted to permanent financing by the same lender” (you), and, therefore, would not be exempt from RESPA.