"The only issue with using the AIR table is that this loan is not based on an index since it's basically a lender buydown so we wouldn't want to use the AIR table."
It is true that a step-rate loan (like the "buydown" transaction you have) does not use an index to determine rate changes, but that is irrelevant. An AIR table is required by the regulations. Details for how the AIR table is to be completed are also contained in the 1026.37(j) rule and Official Interpretations.
Just my opinion, I could be wrong. - Dennis Miller