How are the ‘First Change/Amount’, ‘Subsequent Changes’, and ‘Maximum Payment’ rows of the Adjustable Payment (AP) Table completed on the Loan Estimate and Closing Disclosure for construction transactions with an Application Received Date on or after 10/1/2018?

The language that prints for the First Change/Amount and Subsequent Changes rows is a result of the timing and amount of advances being unknown. The earliest possible time that a borrower may experience a change in the payment amount is at the first payment and potentially each payment may change. For each construction loan, 'at 1st payment’ will print for the First Change/Amount row and ‘Every payment’ will print for the Subsequent Changes row.

The Maximum Payment row discloses the maximum payment amount that can occur over the life of the loan and the payment number of when the maximum payment can be reached. For each construction loan, the maximum payment amount is based on all of the loan proceeds being advanced and the maximum interest rate than can occur.

Note that when Construction Note Type is Construction and Permanent Note and:

A single fixed interest rate is applicable to the transaction, the maximum payment will always be equal to the amount of the principal and interest payment made in the permanent phase.
A fixed interest rate applies in the construction phase and a variable interest rate applies in the permanent phase, the maximum payment amount may occur in either phase depending on the applicable interest rates.

Note: For transactions with an Application Received Date prior to 10/1/2018, the Adjustment Payment table did not apply to construction only loans but did apply to construction/permanent transactions. The Adjustment Payment table is applicable to construction only and construction/perm transactions with an application received date on or after 10/1/2018.