[Anonymous]

I read the post about ARM notices by Elebra a few days ago. I also read Jack’s blog about current loans with no lookback or a lookback that does not allow enough time for the notice to go out 60 days before. I guess I don’t understand how this can apply to current loans made before this reg goes into effect. We have several old ARM loans that have no lookback or have a lookback of 15 days. Do I need to do anything with these loans? I just can’t get my head around a scenario where a current ARM loan would be affected if there is this exemption in there for loans already on the books with no lookback or a shorter lookback?

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[rcooper]

Loans with no look back or a look back less than 45 days originated prior to January 10, 2015 are and will remain subject to the 25/120 day timeframe. Loans with look back periods of 45 days or more must use the 60/120 day timeframe beginning January 10, 2014. All ARMs (with the exception of frequently adjusting and ARMs adjusting soon after consummation) loans established after January 10, 2015 (regardless of look back period) are subject to the 60/120 timeframe. So you basically have a year after the effective date to make sure your ARM programs include a sufficient look back period to meet the 60/120 timeframe by January 10, 2015.

[elebra]

I know I was the original poster but I’m still confused. Can you tell us in simple English what our notes should say to have a 45 day lookback? Everything says you’ll need to update your contracts…I don’t know what they should say to make it right.

[rcooper]

Here’s a link to a similar post where the question states exact language from their contract regarding the look back period. https://mycomplianceresource.com/forums/topic/regulation-z-arm-notices/

Loans made prior to January 10, 2015 with look backs of less than 45 days can continue to send the notice 25 days before. So if you have loan programs with short or no look back period make sure you update those programs in time to be effective 1-10-15.

[Author]

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