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#260024 - 10/21/04 10:32 PM ARM 15 year historical example?
Richard Insley Offline
Power Poster
Richard Insley
Joined: Oct 2000
Posts: 9,995
Toano, VA
When the Fed amended Section 226.19(b) of Reg. Z to make the 15 year historical example optional, many banks dropped it in favor of the simpler 'worst case' example. If you're an ARM lender, how do you handle this?
15 yr. historical or 'worst case'
single choice

Votes accepted starting: 10/21/04 04:00 AM
You must vote before you can view the results of this poll.
...gone fishing.

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Lending Compliance
#260025 - 10/22/04 09:59 AM Re: ARM 15 year historical example?
Rocky P Offline
Power Poster
Joined: Jun 2003
Posts: 7,232
Using the simplified worst case example makes the process so much simpler to recalculate annually. The disclosure for a product with discount, premium and fully indexed is a double sided piece of paper that takes all of 15 minutes to recalculate annually.
Integrity. With it, nothing else matters. Without it, nothing else matters.

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#260026 - 10/22/04 03:17 PM Re: ARM 15 year historical example?
Peepers Offline
10K Club
Joined: Jul 2002
Posts: 13,994
When using the simplified version for an ARM, is it necessary to recalculate the payment example yearly?

I know we have to for the historical example on a HELOC. We have to use the most current rate.

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#260027 - 02/03/05 07:55 PM Re: ARM 15 year historical example?

I am trying to talk my lending group into going with the "worse case" disclosure versus the historical data we now use, which is cumbersome. I however, can't find the reference in 226.19 b that allows this. I know there was an amendment but can't even find in the Federal Register. Can anyone help me??

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#260028 - 02/03/05 08:11 PM Re: ARM 15 year historical example?

Nevermind, I found what I was looking for,thanks.

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