If a residential ARM loan does not have a rate change, and therefore, does not have a payment change, is the bank still required to send the ARM notice?
Regarding the APR on the Closing Disclosure: our ARM rates are set at application. Our Note provides for a 45-day look-back for rate changes. I'm conflicted reading the regulation and want to verify that we should be using the index within that 45-day period before consummation to calculate the APR on the CD?
The initial rate is not determined by "index + margin," but changes are based on index/margin/caps. I think they should be using the most current index when the CD is issued. Often times the application date is greater than 45 days from consummation. I believe this is the most conservative approach.
If an interest rate adjustment occurs on the mortgage at the same time escrow analysis is completed, can these notices be combined?
Should the payment change date on the table for the Interest Rate Adjustment reflect the payment change for escrow analysis if that date is before the date the payment changes for the interest rate? Ex. Rate changes May 1st. Payment would change June 1st, but the payment also changes May 1st for escrow analysis. The table shows payment change for May 1st.
All of our TRID loans are on a variable rate that changes monthly. I thought the required rate cap was an increase or decrease of 2% each time it changes. Now I cannot find any documentation regarding this issue. I know we have to disclose the ceiling but is the adjustment under our discretion?
On ARM loans, is the first interest rate change calculated from the loan date or in the case of recission, the disbursement date?
Can a broker provide the borrower a copy of the CHARM booklet? If so, does the lender have any responsibility to ensure it was provided timely?
Our bank is looking into offering mortgages with an initial fixed rate, short term loan (5-7yrs) with a balloon payment, then financing the balloon
balance into a longer term (20yr) ARM. Can we do this without determining Ability to Repay for the initial short term portion? Also, would this be
dependent on if the bank is considered a small creditor and serves only rural or underserved areas?
Can a 30 year fixed mortgage be converted to a 5/1 ARM mortgage? What information needs to be provided to the consumer to have this done and can
it be a modification or must it be a refinance?
Can the bank charge a default rate on a single-close, construction-perm mortgage loan during the construction phase if construction is not completed on time? For example, a 9 month construction term with multiple draws has a fixed interest at 4.125%. If construction is not completed at 9 months when the construction phase is to mature a default rate of 4.625% would apply from the maturity of that phase. If it is permissible, does this make the loan an ARM or the increased rate a refi?
Our HELOCs are tied to prime. We disclose that. If prime increases do we need to send rate change notices?