We are setting up PELs and are confused. We want to use a single payment note for 12 months and then renew it with the interest in 12 months. Is this a reasonable way to structure the loans? If so, do we disclose the “term” as 12 months? Or, do we disclose it as 18 months because of the 6 month deferral period? Do we disclose the finance charge for 18 months? Do we have to factor in the potential repayment term of 120 monthly payments? (4 years in school, 6 mo. deferral plus the 120 months?)
Do we need to disclose three programs? The deferral period, the interest only option and the fully amoritized option. Help!