Adjustable rate mortgages: balloon payments.

Existing law requires applicants for adjustable rate loans to be provided a specified disclosure notice. Existing law requires written notice to be provided at least 90 days prior to the date of the final payment on a balloon payment loan, as defined, that is secured by a deed of trust or mortgage on real property containing one to 4 residential units. This bill would prohibit balloon payments from being included in the terms of an adjustable rate loan, as defined, for real property containing one to 4 residential units secured by a mortgage or deed of trust on real property.