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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?
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.

First published on 11/15/2015

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