Question:
We have a customer who took a 3/3 ARM four years ago. It adjusted at the three year mark as normal, but then adjusted one year later (last month). When the customer contacted us, we realized that it had been mis-entered in our system as a 3/1. The customer has benefited from a lower rate at this point (first new payment is currently due), but we are not sure of the implications from correcting this. My thoughts are to do one of three things: 1) Allow this payment to be made at the lower rate, but change the product back to the 3/3 at the current (higher) rate for the remainder of the term. 2) Offer to keep the lower rate and do a modification to a 3/1 if the customer accepts. 3) Change the product back to the 3/3, but keep the lower rate for the remainder of the period (2 years) Any thoughts from a compliance or legal standpoint?
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