Posted by Mischell/MA on 11/4/05 7:12pm
Msg #74458

Irep/Beneficial Question

Got a call today to do an Irep/Beneficial closing. I donot usually do these, because IREP Rarely meets my fee, howerever, today they must have been in a pinch because they did. Anyhoo, I get there, The nice staff fills me in on some stuff for the signing, but had no time to review the docs. The customers were signing for a line of credit with a balloon feature. Can someone fill me in on a balloon feature. I had to have the loan officer go over that page with the borrowers.

Reply by Rebecca_TN on 11/4/05 7:49pm
Msg #74462

If it is the typical Benefical line of credit, the term of the loan is 15 years. As the balance of the loan goes down, the required payment goes down. If the borrower only make the minimum payment, the loan will not be paid off at the end of the 15 years and they will have a large balloon due at the end of term. Beneficial has calculated the minimum amount they need to pay each month in order to have the loan paid off in 15 years. You need to be sure the borrower understands how this works.

Reply by BetsyMI on 11/5/05 10:22am
Msg #74555

Rebecca, you say "you need to make sure the borrower understands how this works". You don't mean the notary has to explain it do you? This is not the job of the notary. The LO should be making sure the borrower understands how this works. IMO.