When doing the LE/CD and you have a floor that is lower than index+margin, for an ARM loan would the minimum payment in the projected payments section for the first rate change be the floor (since it could stay that low), or use the fully indexed rate at the time of the disclosure for the first change?

In the projected payment table? It would be the lowest and highest possible payment for that period of time covered in the column to which you are referring. The projected payments table is not related to the payment streams necessary to calculate the APR.

That is what I thought.. so if we had a 10/1 ARM and have a floor, the lowest possible payment in year 11...that time period, is the floor....... Examiner is stating it should be the fully indexed rate. Ex: Let's say the floor rate is 3.25 , But the index was 1.55 + margin of 2.75 at the time of the LE. We are giving the lowest possible payment at the 1st change year 11 using 3.25% because that is as low as it can go. They are saying it should be based on index at the time of the LE 1.55 + 2.75 margin because that is the fully indexed rate (but it may not be at that time), the index could go back down in 10 years and be even lower than the floor. Right? Am I missing something that says we have to go with the fully indexed rate when doing the projected payments if initial rate is considered a discount rate because it is less than the current index + margin? This even says to keep in mind lifetime interest rate floor.

2.2.3.BGenerally, calculate Principal & Interest using the maximum payments by assuming that the interest rate will rise as rapidly as possible, taking into account the terms of the legal obligation, including any applicable caps on interest rate adjustments and lifetime interest rate cap. Other laws, such as a State usury law, can set the maximum rate if the legal obligation does not include a lifetime interest rate cap. Calculate the minimum payments by assuming that the interest rate will decrease as rapidly as possible, taking into account any introductory rates, caps on interest rate adjustments, and lifetime interest rate floor. For an Adjustable Rate loan based on an index that has no lifetime interest rate floor, the minimum interest rate is equal to the margin. (Comment 37(c)(2)(i)-1)

Examiner - as in Federal examiner?

The examiner is confusing TRID disclosure requirements and the rules that you quoted for disclosing the projected payments table on the LE/CD and how you calculate the payment streams for calculating the APR under Comment 10 to 1026.17(c).

You need to kick this one up the chain of command with your examiner team.

Will do! Thank you for your response.