Answer:
If you make a new loan, new disclosures are required. Under Reg Z, 226.20, you are provided with guidance on what will and will not require new disclosures.
"Back in the day" we used to provide a disclosure that a balloon loan was due at maturity, had to be paid in full, and there was no guarantee of any renewal, etc. That was in part to distinguish it from ARM loans. It is my own opinion that balloon loans are getting confused with ARMs by lenders and borrowers alike. I think there could be both Reg Z and UDAP issues if the confusion rises to the point of litigation. So read 226.20 well.
First published on BankersOnline.com 9/19/11
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