A borrower switched from a 5/1 ARM product to a 7/1 ARM product. The 5/1 ARM Disclosure was provided, but a new disclosure was not given at the time the product changed describing the terms of the 7/1. What are the consequences of this? Is their any remedy?

The information in the note and other closing documents reflect a 7/1.

You have a violation. Train and move on.

That is what I suspected. When communicating the violation, what can I cite in the regulation? Thanks Randy.

Commentary to 1026.19(b)(2)

Paragraph 19(b)(2)

1. Disclosure for each variable-rate program. A creditor must provide disclosures to the consumer that fully describe each of the creditor's variable-rate loan programs in which the consumer expresses an interest. If a program is made available only to certain customers of an institution, a creditor need not provide disclosures for that program to other consumers who express a general interest in a creditor's ARM programs. Disclosures must be given at the time an application form is provided or before the consumer pays a nonrefundable fee, whichever is earlier. If program disclosures cannot be provided because a consumer expresses an interest in individually negotiating loan terms that are not generally offered, disclosures reflecting those terms may be provided as soon as reasonably possible after the terms have been decided upon, but not later than the time a non-refundable fee is paid. If a consumer who has received program disclosures subsequently expresses an interest in other available variable-rate programs subject to 1026.19(b)(2), or the creditor and consumer decide on a program for which the consumer has not received disclosures, the creditor must provide appropriate disclosures as soon as reasonably possible. The creditor, of course, is permitted to give the consumer information about additional programs subject to §1026.19(b) initially.

Many times, thank you!