What does TRID stand for?
TILA RESPA Integrated Disclosure Rule
What regulation(s) does TRID association with?
Regulation Z & X
What is the regulatory agency for TRID?
Board of Governors of the Federal Reserve (FRB)
Who administers and enforces TRID?
Consumer Financial Protection Bureau
What is the purpose of TRID?
- To help consumers with helpful information towards understanding costs, features and risks of the mortgage loan they are applying for;
- Consolidate the four existing disclosures required under TILA & RESPA into two forms, the LE & CD
What is a change of circumstance?
When the terms or costs of the loan change due to information provided by the borrower in good faith is incomplete or inaccurate
The Loan Estimate (LE) is a combination of what two forms?
Good Faith Estimate (GFE) & Truth-in-Lending (TIL) disclosures
When must the initial LE be delivered?
By the 3rd business day after receipt of application
3 -Delivered within 3 days of application
7 - Must wait from initial LE to close
3 - Redisclosure within 3 days of changed circumstance
How soon can the loan close after delivery of the initial LE?
The initial LE must be delivered/mailed no later than 7 business days before closing of the loan
3 -Delivered within 3 days of application;
7 - Must wait from initial LE to close;
3 - Redisclosure within 3 days of changed circumstance
When must the revised LE be delivered? Provide two requirements.
- No later than three (3) business days after receiving the information to revise the LE;
- No later than four (4) business days prior to the closing of the loan
Terms on the LE must be valid for how many days?
10 business days
When is a revised Loan Estimate required to be sent to the borrower? Name three causes…
- Change of Circumstance (If changed circumstances cause the aggregate charges to increase by more than 10%);
- Change in eligibility;
- Consumer-requested revisions;
- Delays caused by the consumer;
- Delays related to construction loans
What are three (3) examples of a changed circumstance?
- Extraordinary or unexpected events;
- Information relied upon by the creditor was determined to be inaccurate or changes after the LE is provided;
- New information
There are three (3) limiting categories on fees contained within the Loan Estimate. What are the categories?
- Zero tolerance fees;
- 10% tolerance fees;
- Unlimited tolerance fees
What are some examples of “zero tolerance fees”?
- Fees paid to the creditor, mortgage broker or an affiliate;
- Fees paid to an unaffiliated 3rd party if the creditor didn’t permit the consumer to shop for that settlement service;
- Transfer taxes
What are some examples of “10% tolerance fees”?
- Recording charges;
- Charges for 3rd party services where:
(1) The charge is not paid to the creditor or their affiliate;
(2) The consumer is permitted by the creditor to shop for the 3rd party service and the consumer selects a 3rd party service provider on the creditors written list of service providers;
What are some examples of “unlimited tolerance fees”?
- Prepaid interest, property insurance premiums, amounts placed into escrow, reserve or similar account;
- Services required by the creditor where the consumer shops around and selects a service provide NOT on the creditor’s written list of service providers;
- Charges paid to 3rd party service provides not required by the creditor
What is the purpose of the Closing Disclosure (CD)?
To provide disclosures that help the consumer understand the costs of the transaction
The Closing Disclosure (CD) is a combination of what two forms?
The HUD-1 & the final TIL disclosures
When must the CD be delivered to the borrower?
The consumer must receive the CD at least 3 business days prior to the closing of the loan
When is a revised CD required to be sent to the borrower?
When there are changes to:
- APR (when changes are greater than 0.125% for regular loans & 0.25% for ARM loans); or
- Changes to the loan product; or
- The addition of a prepayment penalty
When can the loan close after a revised CD is provided to the borrower?
After 3 business days
What are the record retention requirements for the Loan Estimate (LE)?
3 years
What are the record retention requirements for the Closing Disclosure (CD)?
5 years
