Our software vendor in updating our historical HELOC table included a D for discount for year 1 [2008]. We have a floor of 5%. That year the index is listed as 3.50% and the margin is 1.00% with an APR of 3.5% "D". All other years where the index is 3.25 or 3.5, the APR is listed as 5.00% M "M" means maximum/minimum rate cap.
Our bank has never offered a discounted rate; rates are always 5.00% or better. Are they correct in saying the first year is a discount? They are siting 12CFR1026.40(d)(12)(xi) as regulatory requirement for this.
Your help would be appreciated. We have only used this vendor for 3 years; this is the first we have seen this. Thanks!!