Question

For most ARMs, rate/payment change disclosures must be provided no less than _____ days.

A) 30 days
B) 45 days
C) 60 days
D) 90 days

Answer 1

For most ARMs, rate/payment change disclosures must be provided at least 60 days before the first payment at the adjusted level is due, as mandated by Regulation Z of TILA.

Step-by-step explanation:

For most Adjustable Rate Mortgages (ARMs), rate/payment change disclosures must be provided no less than 210 days before the first payment at the adjusted level is due.

However, for the initial interest rate adjustment for ARMs with uniformly scheduled adjustments occurring every 60 days or more frequently, the disclosure must be provided at least 60 days before the first payment at the adjusted level is due.

So, the correct answer to the question is option C) 60 days.

These rules are governed by Regulation Z, which implements the Truth in Lending Act (TILA), aiming to ensure that borrowers are well-informed about the terms and conditions of their mortgage.