Identify RESPA Disclosure Requirements - Nationwide Multistate Licensing System NMLS

1. What is the required timing for the consumer to receive the Closing Disclosure before consummation?

   At least $3$ business days before consummation. TRID mandates sufficient review time for final loan details to ensure consumers can verify costs before committing to the transaction.

2. Which federal rule governs the Loan Estimate and Closing Disclosure forms for most closed-end consumer mortgages?

   TRID (TILA-RESPA Integrated Disclosure) under Regulation Z. TRID integrates TILA and RESPA to streamline mortgage disclosures, mandating standardized forms for transparency in closed-end consumer mortgages.

3. What is the general rule on imposing fees before the consumer indicates intent to proceed?

   No fees except a bona fide credit report fee. TRID prohibits most fees prior to intent to proceed to protect consumers from undue financial commitment during initial loan shopping.

4. Identify what "consummation" means for Closing Disclosure timing under Regulation Z.

   When the consumer becomes contractually obligated on the credit transaction. Consummation marks the point of legal commitment, aligning disclosure timing to precede binding obligations under Regulation Z.

5. Which business-day definition applies to the $3$ business days to deliver the Loan Estimate?

   Creditor business days (days the creditor's offices are open). The specific business day definition ties delivery to the creditor's operational days, ensuring feasible timing for Loan Estimate issuance.

6. Which disclosure shows the Loan Terms, Projected Payments, and Costs at Closing on the first page?

   Loan Estimate. The first page summarizes key loan features to provide an at-a-glance overview for consumers during the application phase.

7. Which charges are generally not subject to tolerance limits and may change without a cap?

   Prepaids, escrow, third-party services borrower can shop for, insurance. These items are exempt from tolerances as they often fluctuate based on consumer choices or timing, allowing flexibility in estimates.

8. Which six items trigger an "application" under TRID for Loan Estimate timing?

   Name, income, SSN, property address, estimated value, loan amount. These specific pieces of information indicate a complete application, triggering the creditor's obligation to provide timely disclosures under TRID.

9. Identify the required timing to provide the Special Information Booklet for purchase transactions subject to TRID.

   Within $3$ business days of application. The booklet educates homebuyers on settlement costs, with timing aligned to the Loan Estimate for comprehensive early information.

10. What is the deadline for the creditor to correct a tolerance violation after consummation?

    Within $60$ calendar days after consummation. Post-consummation cures allow creditors to refund overcharges, ensuring compliance with TRID tolerance rules within a reasonable timeframe.

11. Which document must be provided for a written list of settlement service providers when shopping is allowed?

    Written List of Providers (with the Loan Estimate). The list informs consumers of options for shoppable services, promoting competition and choice as required by TRID.

12. Which three changes require a new $3$-business-day waiting period for a corrected Closing Disclosure?

    APR increase beyond tolerance, loan product change, prepayment penalty added. These significant changes affect loan affordability, necessitating additional review time to protect consumer interests under Regulation Z.

13. What action by the consumer allows the creditor to collect most fees and proceed with processing?

    Consumer indicates intent to proceed. Consumer's intent to proceed signals agreement with disclosed terms, allowing creditors to advance the loan process under TRID rules.

14. Which business-day definition applies to the $3$-day waiting period for the Closing Disclosure?

    All calendar days except Sundays and legal public holidays. This general business day definition applies to waiting periods, providing consistent timing excluding only non-working days.

15. What is the latest time a creditor may issue a revised Loan Estimate before consummation?

    No later than $4$ business days before consummation. This cutoff ensures any late changes are handled via the Closing Disclosure, maintaining the integrity of the review period.

16. Which party is primarily responsible for ensuring the Closing Disclosure is provided to the consumer on time?

    Creditor (may delegate delivery, but retains responsibility). The creditor bears ultimate responsibility for compliance, even if settlement agents handle delivery, to enforce TRID standards.

17. Which disclosure is used instead of the Closing Disclosure for TRID-exempt transactions like HELOCs?

    HUD-1 Settlement Statement (or equivalent) and TILA disclosures as applicable. Exempt transactions revert to pre-TRID requirements, using separate TILA and RESPA forms for appropriate disclosures.

18. Which disclosure must be provided when the annual percentage rate changes beyond allowed tolerances?

    Corrected Closing Disclosure with a new $3$-business-day wait. APR inaccuracies trigger a new waiting period to allow consumers time to reassess the loan's true cost under TRID.

19. Which disclosure provides a detailed accounting of final closing costs and cash to close?

    Closing Disclosure. It finalizes all transaction costs, ensuring transparency and accuracy at closing as mandated by TRID integration.

20. Which transactions are generally exempt from TRID Loan Estimate and Closing Disclosure requirements?

    HELOCs, reverse mortgages, and loans not for $1$-$4$ family dwellings. TRID applies primarily to standard closed-end residential mortgages, exempting these to tailor disclosures to specific transaction types.

21. If the Closing Disclosure is mailed, what is the presumed receipt period used for timing the $3$-day review?

    $3$ additional business days for presumed receipt. Mailing adds a presumption of delayed receipt, extending the timeline to ensure the required review period under Regulation Z.

22. What is the required timing for delivering or mailing the Loan Estimate after application?

    Within $3$ business days of application. Regulation Z requires prompt disclosure of estimated loan terms to inform consumers early in the mortgage application process.

23. What is the general rule for providing a revised Loan Estimate after a valid change of circumstance?

    Deliver or mail within $3$ business days of learning of the change. A valid changed circumstance permits revised estimates, requiring prompt delivery to maintain accurate disclosures under TRID.

24. What is the maximum total increase allowed for zero-tolerance charges from LE to CD?

    $0$ increase permitted (zero tolerance). Zero-tolerance items, like lender fees, must remain unchanged to prevent unexpected cost increases at closing under TRID tolerances.

25. What is the maximum aggregate increase allowed for 10% tolerance charges from LE to CD?

    Total increase limited to $10\%$ in the aggregate. The 10% tolerance category allows limited aggregate increases for certain third-party fees to account for reasonable estimate variations.

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