Skip to content
BOL Conferences
Thread Options
#2144678 - 09/01/17 05:29 PM Prepaid Interest included in first payment LE
Bec Offline
Diamond Poster
Bec
Joined: Jul 2010
Posts: 1,115
The Great White North
12 month, interest-only, fixed rate bridge note. The prepaid interest is being calculated as being paid in the first payment by our LOS. Is this accurate. We have had a problem with LOS goblins and for some reason this just doesn't look right to me so I want to make sure that the prepaids should default to paid in the first payment.
_________________________
Go Packers

Return to Top
TRID - TILA/RESPA Integrated Disclosures Rule
#2144684 - 09/01/17 05:35 PM Re: Prepaid Interest included in first payment LE Bec
rlcarey Online
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,227
Galveston, TX
If you are not collecting odd-days interest, all accrued interest will be due in the first payment.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2144708 - 09/01/17 06:58 PM Re: Prepaid Interest included in first payment LE Bec
Bec Offline
Diamond Poster
Bec
Joined: Jul 2010
Posts: 1,115
The Great White North
Would you ever disclose fees paid in cash on an LE payment calculation?
_________________________
Go Packers

Return to Top
#2144710 - 09/01/17 07:06 PM Re: Prepaid Interest included in first payment LE Bec
rlcarey Online
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,227
Galveston, TX
Not sure what you mean? - odd-days interest is required to be estimated in closing costs in Section F. Or have you switched subjects?
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2144723 - 09/01/17 08:23 PM Re: Prepaid Interest included in first payment LE Bec
Bec Offline
Diamond Poster
Bec
Joined: Jul 2010
Posts: 1,115
The Great White North
I am not sure I know what I mean either. I am flummoxed.
We are trying to disclose a one year, interest only bridge loan and our first payment is showing as a monthly payment with the prepaid interest added on and that is it. Is that how it is suppose to disclose and the borrower is to be told that the payment won't be that high for the rest of the term because there will be no prepaids? Or do we have a setting wrong?

Loan information
Loan Term:1 Year
Purpose: Purchase
Product: 11 Mo. Interest Only, Fixed Rate
Loan Type Conventional

Loan Amount: $195,000
Interest rate: 4.75%
Monthly Principal & Interest: $1,091.19

Projected payments: Year 1: $1,091.19 [/i]only interest[i]
Final Payment $195,786.67

This is on the CD. The loan is set to close on the September 7th. Disburse on September 12th. First Payment date. October 25, 2017
Last edited by Bec; 09/01/17 08:28 PM.
_________________________
Go Packers

Return to Top
#2144736 - 09/01/17 09:25 PM Re: Prepaid Interest included in first payment LE Bec
rlcarey Online
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,227
Galveston, TX
So you are concerned that the remainder of the payments after the first one for $1,019.19 will be less and is not disclosed in a range in the projected payments table?

I believe you can ignore disclosing the range in the projected payments table based on the following Since the first payment period is longer by only 13 days:


1026.17(c)(4) In making calculations and disclosures, the creditor may disregard any irregularity in the first period that falls within the limits described below and any payment schedule irregularity that results from the irregular first period:

(ii) For transactions in which the term is at least 1 year and less than 10 years, a first period not more than 11 days shorter or 21 days longer than a regular period; and
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2144739 - 09/01/17 09:44 PM Re: Prepaid Interest included in first payment LE Bec
Bec Offline
Diamond Poster
Bec
Joined: Jul 2010
Posts: 1,115
The Great White North
Yes, that was my concern for sure. Thank you for the citation. I appear to need a bit of revisting of regulation z. I was appeased somewhat by an amortization schedule and the note matching up with the first payment and subsequent lower payments. But this puts the icing on the cake. I really can't thank you enough smile
_________________________
Go Packers

Return to Top