[mdunker]

I have a question regarding the 210-240 day notice. We have our Core system set up to print the notices at 230 days. The 230 days for December fell on a Sunday, what my core did was wait until Monday and use the effective date of the 15th for the new Index. Is this in compliance since we have up to 240 days?

Topic

[rcooper]

Reg Z, 1026.20(d) states that you must deliver the initial rate adjustment notice at least 210, and no more than 240 days before the first payment at the new rate is due.

From the information you’ve given it sounds like you are in compliance, since your disclosure is going out well before the 210 day minimum. As for the rate used, Reg Z 1026.20(d)(2) states:

If the new interest rate (or the new payment calculated from the new interest rate) is not known as of the date of the disclosure, an estimate shall be disclosed and labeled as such. This estimate shall be based on the calculation of the index reported in the source of information described in paragraph (d)(2)(iv)(A) of this section within fifteen business days prior to the date of the disclosure.

Your estimate was based on the index as of the date the disclosure was produced, so it was well within that 15 business day time frame prior to the disclosure.

Based on my understanding of what you’ve stated, it sounds like you’re in compliance.

[Author]

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