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Can You Use A 30/360 Accrual Method On Bridge?

Question: 
Is it ok to use a 30/360 accrual method on a bridge loan to purchase primary residence with interest only payments?
Answer: 

Richard Insley

This is a matter of state law.

Answer: 

David Dickinson

You can use any accrual method you want (following state law, of course, as Richard pointed out), but the APR must still be accurate. Whenever you move away from 365/365, the FC and APR can get distorted.

First published on 10/27/2014

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