Reg Z – How should the Projected Payments, Payment Calculation section be completed on the Loan Estimate?

Compliance > Regulation Z - TILA / TRID Specific > Loan Estimates
Q:  How should the Projected Payments, Payment Calculation section be completed on the Loan Estimate?
 
A:  Regulation Z has technical requirements for the completion of the Projected Payments, Payment Calculation section.  While creditors should review regulatory conditions and commentary, a general description of the requirement is as follows: 
 
The Projected Payments section is provided to disclose an itemization of each separate periodic payment or range of payments, followed by information on estimated taxes, insurance and assessments.    With regard to the Payment Calculation disclosures, creditors must show in one column, the initial periodic payment (or range of payments) for:
 
  • Principal & Interest
  • Mortgage Insurance
  • Estimated Escrow
 
This column will also display the years of the loan during which the payments will apply.  Then, depending on the features of the loan, subsequent columns and periodic payments also may be required to be disclosed.  However, as the regulation states, the table shall not disclose more than four separate periodic payments or ranges of payments. 
 
Here are two sample excerpts from Reg. Z, Appendix H:
 
H-24(B) Mortgage Loan Transaction Loan Estimate—Fixed Rate Loan Sample (Excerpt)
 
H-24(C) Mortgage Loan Transaction Loan Estimate—Interest Only Adjustable Rate Loan Sample (Excerpt)
 
 
ADDITIONAL INFORMATION – The regulatory citation for this topic is 12 CFR 1026.37(c). 
This disclosure is also addressed in the CFPB's “Guide to the Loan Estimate and Closing Disclosure forms,” which may be found here - http://www.consumerfinance.gov/regulatory-implementation/tila-respa/

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