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# What is the rate spread?

The rate spread is the difference between the annual percentage rate (APR) and the applicable average prime offer rate. For a detailed description of the rate spread calculations, see https://www.consumerfinance.gov/policy-compliance/guidance/implementation-guidance/hmda-implementation/.

When HMDA Applies is selected and you are licensed for HMDA Wiz, the calculated rate spread is displayed in the Rate Spread section on the Calculations page. When items that impact the Rate Spread are modified, the Rate Spread will be cleared and you will need to select Calculate Rate Spread to receive an updated value. Items that could affect the rate spread and result in it being cleared include the Action Taken, Interest Rate/Initial Rate, Rate Lock Date, the calculated APR, Number of Payments for a fixed rate transaction or Initial Rate Hold Term for a variable rate transaction, and the Organization's Lien Position of the collateral.