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#2274724 - 08/25/22 05:36 PM Historical Table on HELOC
Compliance Novice Offline
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Joined: Sep 2003
Posts: 22
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!!

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Lending Compliance
#2274728 - 08/25/22 06:06 PM Re: Historical Table on HELOC Compliance Novice
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 83,227
Galveston, TX
What is your starting rate for the HELOC. Is it equal to or less than the current Index plus Margin at the time of closing. Is your start rate set at a certain rate regardless of the underlying index plus margin?
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The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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#2274787 - 08/26/22 02:28 PM Re: Historical Table on HELOC Compliance Novice
Compliance Novice Offline
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Joined: Sep 2003
Posts: 22
We have figured out what was missing from our parameter settings. The disclosure now reads correctly! Thank you for your help!

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