Variable Rate Mortgage Program Disclosure Form
ADVERTISEMENT
1
2VARIABLE RATE MORTGAGE PROGRAM DISCLOSURE
(This is neither a contract nor a commitment to lend.)
Borrower(s):
Lender:
Loan Number:
VARIABLE RATE MORTGAGE PROGRAM: ________________________________________
This Variable Rate Mortgage Program Disclosure describes the features of the adjustable rate mortgage (ARM) you are
considering. Information on other variable rate mortgage programs is available upon request.
HOW YOUR INTEREST RATE AND PAYMENT ARE DETERMINED
□
Your interest rate will be based on an index plus a margin.
□
This variable rate mortgage loan has a ______________ feature, and your initial interest rate will not be based on the
index used for later adjustments. Please ask about our current discount or premium amount.
□
□
□
□
This type of ARM loan carries a provision for a change in:
Interest Rate
Monthly Payment
Loan Term
Your payment will be based on the interest rate, loan balance and loan term.
The index used to determine your initial interest rate and/or all adjustments is:
__________________________________________________________________________________________________
__________________________________________________________________________________________________
NOTE: if the index for your variable rate mortgage loan is no longer available, the Lender will choose a new index which is based on comparable information.
Ask for our current interest rate and margin.
HOW YOUR INTEREST RATE CAN CHANGE
Your interest rate can change ______________________, and every _____________________________ thereafter.
Your interest rate cannot increase more than ________________ percentage point(s) at the initial adjustment.
Your interest rate cannot decrease more than _______________ percentage point(s) at the initial adjustment.
Your interest rate cannot increase more than ________________ percentage point(s) at each periodic adjustment.
Your interest rate cannot decrease more than ________________percentage point(s) at each periodic adjustment.
Your interest rate cannot increase more than ________________ percentage point(s) over the term of the loan.
Your interest rate cannot decrease more than ________________percentage point(s) over the term of the loan.
Your interest rate will never be greater than _______ % or less than ________ % over the term of the loan.
□
□
□
Your interest rate will be rounded off to
the nearest
next highest
next lowest ________% at each adjustment.
□
This variable rate loan utilizes interest rate carryover.
EXAMPLE: _____________________________________________________________________________________
__________________________________________________________________________________________________
HOW YOUR PAYMENT CAN CHANGE
Your payment can change ______________, and every______________ thereafter, based on changes in the interest rate.
□
Your payment will not increase more than ___________ percentage point(s) or $ ______________, at each
adjustment.
You will be notified in writing _______ days before the due date of a payment at a new level. This notice will contain
information about your interest rate, payment amount and loan balance.
EXAMPLE: On a $10,000, _______ year loan with an initial interest rate of __________ percent, (the rate shown in the
interest rate column for the year _____________), the maximum amount that the interest rate can rise under this program
is __________ percentage points, to _________ %, and the _______________ payment can rise from a first year
payment of $_____________ to a maximum of $_______________ in the ______________ year.
□
□
□
Any increase in interest will take the form of
a larger amount due at maturity
higher payment amount or
more
payments of the same amount.
□
This variable rate loan program has a negative amortization feature. An increase in your interest rate will result in
your
loan being negatively amortized, and the following will apply: _________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
YOUR INTEREST RATE CONVERSION OPTION
□
This variable rate mortgage loan program has an option for you to convert your variable interest rate to a fixed interest
rate. You should be aware that if you exercise this option, the interest rate may be increased from the variable rate you
have been paying.
If you choose this conversion option, you may only convert if certain conditions are met. These conditions are:
1.
2.
3.
4.
5.
ADVERTISEMENT
0 votes
Related Articles
Related forms
Related Categories
Parent category: Financial