2(p) Refinancing
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step one. Standard. Area 1003.2(p) defines an excellent refinancing since a close-avoid home loan otherwise an unbarred-prevent personal line of credit in which another, dwelling-shielded financial obligation obligations satisfies and you may substitute an existing, dwelling-protected personal debt duty because of the exact same debtor. Except since described from inside the remark dos(p)-dos, if or not a refinancing possess taken place hinges on regard to whether or not, based on the parties’ price and you can relevant legislation, the initial obligations obligations might have been fulfilled or changed from the a the obligations responsibility. Whether the brand spanking new lien was met is actually irrelevant. Such:
ii. A separate discover-avoid credit line you to joins and you can substitute an existing closed-prevent real estate loan is actually a good refinancing significantly less than 1003.2(p).
iii. But as discussed when you look at the comment 2(p)-2, a different sort of loans responsibility one to renews otherwise modifies this new terms of, however, that does not meet and you will change, a preexisting financial obligation obligation, is not an effective refinancing not as much as 1003.2(p).
dos. Ny State consolidation, expansion, and you may modification agreements. Where an exchange is performed pursuant to a new York State consolidation, expansion, and you can amendment agreement which is categorized because the an extra home loan significantly less than Ny Income tax Laws area 255, in a manner that the fresh new borrower owes less or no mortgage tape taxes, and you will where, but also for the latest contract, the transaction might have fulfilled the term an excellent refinancing around 1003.2(p), the order is known as good refinancing less than 1003.2(p). Pick including comment 2(d)-2.ii.
step 3. Present loans responsibility. A close-end home loan otherwise an unbarred-end credit line you to matches and you will substitute one or more existing debt obligations is not a refinancing lower than 1003.2(p) unless of course current debt obligations (otherwise debt) including is actually safeguarded by the a dwelling. Instance, think that a debtor provides a preexisting $31,000 finalized-avoid mortgage loan and you will gets a unique $fifty,000 closed-prevent home mortgage you to meets and you will substitute the present $30,000 mortgage. 2(p). Although not, when your debtor receives a separate $fifty,000 finalized-avoid mortgage you to definitely suits and you will changes a current $29,000 loan secure simply because of the an individual verify, the latest $fifty,000 financing isnt a good refinancing less than 1003.2(p). Get a hold of 1003.4(a)(3) and you can relevant opinions to have information on how to declaration the mortgage aim of such as for instance transactions, if they are not otherwise omitted lower than 1003.3(c).
A separate signed-prevent real estate loan one joins and you can changes a minumum of one current closed-end mortgage loans is a beneficial refinancing around 1003
4. Same borrower. Area 1003.2(p) brings one to, although the many other conditions out of 1003.2(p) are fulfilled, a close-end mortgage loan or an open-avoid credit line is not a great refinancing unless of course an equivalent borrower undertakes both established together with the brand new obligations(s). Not as much as 1003.2(p), brand new exact same debtor undertakes the present and also the the duty(s) although only 1 borrower is the same for the each other obligations. Like, think that a current finalized-end real estate loan (responsibility X) is met and you may changed because of the a new finalized-avoid home loan (duty Y). If the borrowers A good and you can B they are both motivated to the obligations X, and just debtor B is required into obligations Y, after that obligation Y is a beneficial refinancing lower than 1003.2(p), if in case the other requirements away from 1003.2(p) was satisfied, once the borrower B are obligated with the one another deals. Simultaneously, only if borrower A beneficial is obligated for the responsibility X, and only borrower B was required toward obligation Y, following obligation Y is not an effective refinancing less than 1003.2(p). Such as, think that a couple spouses are divorcing. In the event that each other spouses is actually compelled into the responsibility X, but just one spouse is actually obligated toward obligations Y, then duty Y was a great refinancing lower than 1003.2(p), and when one other conditions out of 1003.2(p) was came across. Additionally, only if partner Good is actually required to the obligations X, and just partner B was required toward obligations Y, after that obligations Y isnt a good refinancing below 1003.2(p). See 1003.4(a)(3) and you may relevant opinions for recommendations for you to statement the mortgage purpose of such transactions, if they are perhaps not otherwise excluded below 1003.3(c).