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A ‘dwelling’ in simple layman terms is a house or a place of residence however the HMDA has prescribed what this term constitutes. In light of this, a dwelling is a residential structure however it does not really matter whether it is affixed with real property or not. There are particular exclusions which has enhanced certainty. It is not ‘limited to a detached home, an individual condominium..’ etc. Dwellings are not confined to the borrower’s own residence but also covers ‘vacation or second homes and investment properties’. This will also constitute a ‘multifamily residential structure’ with examples being a cooperative building, apartment or condominium.
The exclusions include vehicles for amusement. Section 1003.2(f) renders boats, campers, travel vehicles etc. as not eligible to be deemed as a ‘dwelling’. It is material if it is utilized for residential purposes or not. Houseboats, floating homes and mobile homes(before June 15, 1976), transitory residences and structures employed for commercial reasons only (but not necessarily formed for commercial purposes, what is important is that it was solely used for commercial reasons) are also adjudged as exclusions. In general, mixed- use properties constitute a dwelling as long as the chief use is for residential reasons.
The CFPB’s way of defining a dwelling is not vouched for generally; however we must adhere to this regardless of our views on the stipulated definition. At the very least we have been granted a definitive ‘bright- line test’ and it abolishes the element of subjectivity or the possibility of the term being construed in a varied manner. HMDA is not easy to adhere to hence the fact that mortgage industry constantly enquires into the definition of ‘dwelling’ for decades just portrays how the HMDA really is difficult to conform to.
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