Watch the video clip below to see a portion of the TRID webinar Q & A.
About a month ago, we finished up our three-part webinar series on TRID. “TRID from A to Z” is one of our most popular training series and it is available now OnDemand. We cover a wide variety of topics such as:
- How to Complete the Loan Estimate & Closing Disclosure
- Shopping Requirements & Restrictions
- Changed Circumstances
- Revising Loan Estimates & Closing Disclosures
- TRID for Construction Loans
- Fees & Charges – What, Where, When, Why & How
As with all of our webinars, our goal is to answer your questions and we provide a certain amount of time for you to ask your questions. You can also pre-submit questions to be answered during the webinar. Not only do our experts answer your questions live but we also put them writing for you refer to later on.
See all TRID Resources!
Okay. On this first one, we’ll go back to page 253. If we have issued the closing disclosure and subsequently find out we need to extend a rate lock for whatever reason, are we required to re-issue the closing disclosure each time we extend a rate lock?
So if the rate lock is being extended, just trying to think this through, what’s all affected by that? If there’s no fee for extending the rate lock and the closing date … See, this is where … If you’re extending the rate lock, I’m going to assume that you’re not closing on the same date, which means the closing date, the disbursement date, all that stuff’s going to have to be updated. So if you’re extending the rate lock, I’m assuming the closing date’s changing, which means yes, you need to re-disclose. If for some reason you issued a closing disclosure and the closing date’s going to remain the same, you’re just extending the rate lock for some reason, and it doesn’t affect anything else, then I suppose there’s a way you wouldn’t have to, but traditionally, we would see it affecting other things like the closing date and require a revised version.
Okay, this next one is the one we also addressed last week and decided to come back to it with the closing disclosure, again, this week.
We have a situation where the loan amount was increased on a closing disclosure after the appraisal came in higher than expected. The upfront mortgage fee increased slightly and was cured to the customer on the closing disclosure. Should the loan amount have been increased on a loan estimate instead of a closing disclosure, or did we handle this okay?
Well, there’s a couple of different things I want to address in this. So let’s first address. If we have a change circumstance before the closing disclosure is set to go out, but we’re ready to issue the closing disclosure, do we have to issue a loan estimate first? And the answer, we believe, is no. There’s some bit of miss direction in the rule because it says one thing here and another thing there relative to the loan estimate, but we believe that when they updated TRID 2.0, they meant to indicate that change circumstances could be identified and taken care of with a closing disclosure without having to go back and re-issue a loan estimate and then a closing disclosure tomorrow.
So I don’t think you have to go back and re-issue a loan estimate. It can be just done straight with a closing disclosure. Now they mentioned doing a tolerance cure because of the increase in the loan amount and the appraisal and what it came in at, and long story short, as long as you reissued a, or issued a closing disclosure within three days of learning of the change circumstance, which is the loan amount increasing, right? Or no, it was the appraisal coming in, right?
Yeah. The appraisal came in, which resulted in the loan amount increasing.
Okay. So the appraisal came in, there’s your new information. So something happened with the loan amount. That’s a result of the change circumstance and mortgage insurance change because of that. Since mortgage insurance is directly related to the change circumstance, as long as you get a new disclosure out, either a revised loan estimate or a new closing disclosure within three days, and you put this new updated mortgage insurance number on there, you wouldn’t have a tolerance cure to do. So if anything, it sounds to me like you may not have had to do a tolerance cure, but maybe you didn’t get it done within three days, and then there would be a tolerance cure. So did I answer all the question?
I believe so.
I took us in a lot of different directions there. I just want to make sure I got back to the core question.
Okay, this next one takes us back to the end of last week, and the beginning of this weeks. Do we need to document how a closing disclosure is provided or can it be assumed to be delivered by mail?
That that’s the way our team rolls is that unless the loan file documentation says something different, okay? The loan closing disclosure’s set up such that there’s an issue date, and unless the loan file says it’s anything else, we’re going to assume that it was issued by mail. Okay? So day one, day two, day three. Now it’s in their hand. And three days after that is the soonest we can close. We would only ever question things if the timeframe between the issue date and the closing date was less than a week. Then what we would do is, “Okay, where’s the information in the loan file that says it was received earlier than that?” As long as that timeframe is a week, not counting holidays, there’s no reason for us to question or even concern ourselves with how it was issued, when it was issued, things like that, because there’s the date issued. And if it’s seven days later, assuming there’s no holidays, we’re good to go.
Jerod is the leader of Banker’s Compliance Consulting’s training productions. He is a nationally recognized speaker. Whether it’s a conference, seminar, school, webinar, or luncheon, it’s easy to stay engaged when he presents due to the amount of passion and energy he brings to each and every compliance topic. Jerod has spoken on behalf of the American Bankers’ Association, BankersOnline, many state banking associations, private compliance groups, and financial institutions. He is a Certified Regulatory Compliance Manager (CRCM) and BankersOnline Guru.
Jerod likes to spend his time (between reading regulations and producing compliance training!) relaxing at the lake with his wife and three children, following their activities or engaged in something sports related!