We are planning to offer a discount rate for 90 days for our HELOC product. I found the additional information we need to include in the variable rate language but not much more.
Can anyone answer the following questions:
1. Do you disclose the discount rate and daily dollar rate anywhere on the loan document? Currently we list the margin and the index on the loan agreement but the discount rate we are offering is not tied to an index- it is just a set rate for 90 days.
2. Are we required to include the additional variable rate language concerning the discount in the eraly disclosure or only on the agreement?
3. Would it be possible to just include an addendum for the discount rate that the customer signs?

Thanking you in acdvance for any guidance.
Kreed

Commentary to 226.6(a)(2)(10) states: When creditors use an initial rate that is not calculated using the index or formula for later rate adjustments, the initial disclosure statement should reflect: (1) The initial rate (expressed as a periodic rate and a corresponding annual percentage rate), together with a statement of how long it will remain in effect; (2) the current rate that would have been applied using the index or formula (also expressed as a periodic rate and a corresponding annual percentage rate); and (3) the other variable-rate information required by footnote 12 to § 226.6(a)(2).

Footnote 12 info [when rate may increase, limitations on increase etc] needs to be included on the initial disclosure stmt. I would not use an addendum. I would disclose the teaser rate and "regular" rate in the same area of the disclosure. The early disclosure must state that the initial rate is discounted and how long the discount will be in effect. (plus other variable rate disclosures) Info in the table (early disclosure) must reflect the discounted rate.

Thank you-