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#186791 - 05/04/04 07:35 PM Rate Spread APR Calculation
Anonymous
Unregistered

For confirmation ~
If the APR increases after the initial TIL is given (i.e., the APR is more on the final TIL), do we use the final TIL as the APR and lock in date for the rate spread reporting?

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Lending Compliance
#186792 - 05/04/04 08:14 PM Re: Rate Spread APR Calculation
Anonymous
Unregistered

You use that rate, however you must take care to use the date that the rate was set for the final time - which may be on or before the date the TIL was prepared. In other words, if the final rate was set Jun 30, but the TIL was printed Jul 1, then you use Jun 30 as the date.

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#186793 - 05/04/04 08:35 PM Re: Rate Spread APR Calculation
Richard Insley Online
10K Club
Richard Insley
Joined: Oct 2000
Posts: 10,179
Toano, VA
In addition to determining which month's "applicable Treasury yield" to use as the base for your spread calculation, you must compare with "the annual percentage rate (APR) for the loan, as calculated and disclosed under Sec. 226.6 or 226.18 of Regulation Z." Notice that this part of the HMDA reg does not say the "disclosed APR." If the disclosed APR is later found to be out of tolerance, you could have violations of both Regs. Z and C.
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