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#1080240 - 11/11/08 09:22 PM teaser rate expires -notice of rate chge required?
Chocaholic Offline
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Joined: Aug 2005
Posts: 443
Northwest
We have a 5/1 Arm product that has a teaser rate during the first 12 months of the term... at the end of this term the rate goes up to what it should have been at origination.. do we need to send out Notice of Rate change at this time?

I thought i read that if the rate change was anticipated and disclosed it need not be re-disclosed later..is this correct?

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#1080283 - 11/11/08 11:18 PM Re: teaser rate expires -notice of rate chge required? Chocaholic
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 80,358
Galveston, TX
If you have a teaser rate on a 5/1 ARM that expires in twelve months, you don't have a 5/1 arm - you have a 1/4/1 arm. I hope all your early disclosure and TIL is correct. You will have to follow the subsequent notice provisions of Regulation Z.
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#1080989 - 11/13/08 11:03 AM Re: teaser rate expires -notice of rate chge required? Chocaholic
Richard Insley Offline
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Richard Insley
Joined: Oct 2000
Posts: 10,097
Toano, VA
Read Section 226.20(c) and related OSC.
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