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#2261008 - 10/12/21 12:56 PM 5 Yr Balloon Payment 60 vs. 61 months
Anonymous Offline
100 Club
Joined: Jun 2021
Posts: 137
My team is telling me they have always been told to issue a 5 yr balloon with 61 months payment vs 60. Can anyone tell me where in the regulation this is stated?

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Ability to Repay/Qualified Mortgage Rule
#2261049 - 10/12/21 08:51 PM Re: 5 Yr Balloon Payment 60 vs. 61 months Anonymous
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 46,609
Bloomington, IN
Review 1026.43. It has to do with the ATR.

2. First five years after the date on which the first regular periodic payment will be due. Under ยง 1026.43(c)(5)(ii)(A)(1), the creditor must determine a consumer's ability to repay a loan with a balloon payment that is not a higher-priced covered transaction using the maximum payment scheduled during the first five years (60 months) after the date on which the first regular periodic payment will be due. To illustrate:
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The opinions expressed are mine and they are not to be taken as legal advice.

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