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#1651565 - 01/17/12 04:58 PM APR WIN and New TIL Disclosures for ARM Loans
RGS Offline
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RGS
Joined: Jul 2002
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I think I had a "...well, duh" moment, but please humor and confirm with me.

The changes to the TIL disclosures have, IMO, made it impossible to use the TIL to check APRs using APR WIN, right? Prior to the changes, the TIL itemized the initial payment and the fully indexed payment - upon which the APR was calculated.

Now the TIL lists the initial payment and the worst case scenario payment.

So, in order to properly test the APR on an ARM, it is now necessary to take the initial payment and then also calculate the fully indexed payment for the remainder of the loan.

Is that correct?

TIA
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Lending Compliance
#1651583 - 01/17/12 05:13 PM Re: APR WIN and New TIL Disclosures for ARM Loans RGS
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We ask our processors to provide a screen print of the TIL Disclosures tab off of our system which still itemizes the payment stream needed to use APR Win to check the APR.

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#1651607 - 01/17/12 05:35 PM Re: APR WIN and New TIL Disclosures for ARM Loans RGS
RGS Offline
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RGS
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Home of the 8 time NCAA Champ ...
I can try to get something like that in the future, but for the present I have another question.

Can anyone point me towards a good ARM amortization table online? I can use the information at my disposal and do what I need to do in 2 steps, but I'd prefer to do it in 1 step if at all possible.

Thanks again.
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#1651621 - 01/17/12 05:47 PM Re: APR WIN and New TIL Disclosures for ARM Loans RGS
rlcarey Online
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rlcarey
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Galveston, TX
"So, in order to properly test the APR on an ARM, it is now necessary to take the initial payment and then also calculate the fully indexed payment for the remainder of the loan"

This is not true. There has been no change to the way APRs are calculated.


"Can anyone point me towards a good ARM amortization table online?"

I would suggest that you print one from your system. An amortization schedule directly from your system is a integral part of your proof that your APRs are correct. If you system does not provide that option, then I would be escalating this issue through your processor.
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#1651622 - 01/17/12 05:34 PM Re: APR WIN and New TIL Disclosures for ARM Loans RGS
Richard Insley Offline
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Richard Insley
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Toano, VA
Originally Posted By: RGS
Is that correct?

No. Nothing changed but the manner of disclosing the payment schedule. Neither Appendix J nor the OSC to Section 226.17(c)(1), comments # 8 - 10, have changed.

Section 226.25 requires us to retain evidence of compliance with the regulation. Evidence of compliance with the requirements to disclose an accurate TOP, FC, and APR necessarily includes a full payment schedule.
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#1651631 - 01/17/12 05:40 PM Re: APR WIN and New TIL Disclosures for ARM Loans RGS
Richard Insley Offline
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Richard Insley
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Toano, VA
Originally Posted By: RGS
Prior to the changes, the TIL itemized the initial payment and the fully indexed payment - upon which the APR was calculated.

Second point: This statement is incomplete. Comment #10 (referenced above) directs us to show all "steps" in the payment schedule necessary to get from the note rate to the fully-indexed rate. This could be one step or several, depending on the degree of discount or premium and the rate/payment change caps.
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