Posted By: Likes to Comply
Range of payments-Interest difference-days/month - 04/28/17 08:18 PM
Our new loan software is providing a range of payments in a single column for a fixed rate 11 month interest only loan with principal due in the 12 month. This range is due to days in a month, lowest payment is 28 days of interest, highest payment is 31 days of interest.
1026.37(c)(1)(iii) outlines when we are required to provide a range of payments - basically if we run out of columns and there is triggering events that must be disclosed and so may have to be disclosed the same column, multiple events happen in the same year or initial year and when payments adjust based on adjustable rates changes. It references back to 1026.37(c)(1)(I)(A) and the official interpretations for that section say minor payment variations resulting solely from the fact that months have different numbers of days are not changes to periodic principal and interest payments; but that a change from interest only to payments that do not defer principal are a trigger requiring separate disclosure.
1026.17(c)(3)(iii) says we can disregard the effects of months that have different number of days when making calculations and disclosures.
So while it can be disregarded and is not a requirement for separate disclosure, is it permissible that the software vendor has set the projected payment columns to provide a range of payments in a single column for the number of days in a month?
1026.37(c)(1)(iii) outlines when we are required to provide a range of payments - basically if we run out of columns and there is triggering events that must be disclosed and so may have to be disclosed the same column, multiple events happen in the same year or initial year and when payments adjust based on adjustable rates changes. It references back to 1026.37(c)(1)(I)(A) and the official interpretations for that section say minor payment variations resulting solely from the fact that months have different numbers of days are not changes to periodic principal and interest payments; but that a change from interest only to payments that do not defer principal are a trigger requiring separate disclosure.
1026.17(c)(3)(iii) says we can disregard the effects of months that have different number of days when making calculations and disclosures.
So while it can be disregarded and is not a requirement for separate disclosure, is it permissible that the software vendor has set the projected payment columns to provide a range of payments in a single column for the number of days in a month?