Q: How should the Balloon Payment section be completed on the Loan Estimate?
A: Regulation Z has technical requirements for the completion of the Balloon Payment section. While creditors should review regulatory conditions and commentary, a general description of the requirement is as follows:
The Balloon Payment section contains a question as to whether the loan has that feature. This shall be disclosed as an affirmative or negative answer. Also, IF an affirmative answer, additional information shall also be included:
For example, as excerpted from the fixed rate loan sample H-24(B), this could appear as follows:
For example, as excerpted from the balloon payment loan sample H-24(E), this could appear as follows:
ADDITIONAL INFORMATION – The regulatory citation for this topic is 12 CFR 1026.37(b).