I am just trying to learn and play catch up as quickly as possible on information regarding ARM loans and am wondering about the following:
Does every ARM loan (closed end home equity mortgage) have to have a forecast date listed on the Note that informs the customer of which day the index will be selected from when their rate changes?
I am asking as all the ARM mortgages that I have worked with in the past has included a forecast date, usually 45 days, but I am now looking at a set of ARM Notes that do not contain a forecast date. The note still contains the source if the rate (1 year WSJ, 3 year LIBOR, etc.) but no verbiage pertaining to which index figure would be used, not even daily or the day the change takes effect.
Is this ok? I cannot find any information on the requirements for what information is required to be on the Note.
Is it allowable for us to change these loans to reflect a 45 day forecast?
Wouldn’t we need to adjust these to a 45 day forecast to ensure the ARM notices get sent out per the new timing requirements?
Just questions I am trying to figure out. I am already concerned how these were serviced in the past for providing rate change notices but will review for that after I can figure out what we can do to move forward and ensure we are compliant with the new servicing requirements.
Any thoughts and comments greatly appreciated.