Answer:
The loan is subject to TRID and under 1026.37(b)(5) a single payment is a balloon payment. This is most likely why the LOS is giving the warning.
Single-Pay Option Allowed On Consumer Purpose Loan
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Question:
Our institution has a mortgage loan secured by the borrower's business; the loan proceeds are for personal use. The borrower wants this set up as a single-pay but our loan originating system keeps bringing up a negative amortization warning and ask the originator to switch to a balloon payment or ARM. Is a single-pay an option or is it not allowed for a consumer purpose loan?
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