Pub. 11 2021 Issue 3

16 azbankers.org Continued from page 15 The Loan Estimate (Contents: 1026.37; Timing 1026.19(e)) The clock on the TRID timing requirements begins as soon as the bank receives an “application,” which is defined specifically as submitting the applicant’s name, income, Social Security number, collateral property address, estimated value of the collateral property, and the loan amount requested. Once a bank has received all six pieces of information, the clock has started, and the bank is required to send the applicant a copy of the Loan Estimate within three business days. For this purpose, a business day is any day that the bank is open for carrying on substantially all of its business functions. This means some banks will count Saturdays for this window to send the Loan Estimate, and others will not. The regulations do not require that the initial Loan Estimate be received by any particular number of business days, so any questions of the receipt of the Loan Estimate are almost always relative to loan closing. The bank is only required to honor the estimates given on the Loan Estimate for 10 business days, after which the Loan Estimate expires. If the applicant decides to proceed after expiration, it is up to the bank to honor the existing estimates or provide an applicant with a new Loan Estimate with new estimated costs. Expiration is determined using the definition of business day, including Saturdays for some banks but not for others. event in connection with closing causes the Closing Disclosure to be inaccurate, and the inaccuracy results in a change in the amount paid by the consumer, the bank must send a copy of the revised Closing Disclosure no later than 30 calendar days after discovery of the inaccuracy. If the bank discovers a non-numeric clerical error within the 60 calendar day period following the loan closing, the bank is required to send a copy of the revised Closing Disclosure no later than 60 calendar days after loan closing. If the amount paid by the consumer exceeds the amount indicated on the Closing Disclosure, the bank must provide a refund, and a revised Closing Disclosure, to the consumer no later than 60 calendar days after the loan closing. w John S. Berteau serves as Associate General Counsel for Compliance Alliance. He has nearly fifteen years of combined experience in the financial services industry. At Hancock Whitney Bank, he worked in the field of environmental risk management and compliance (CERCLA/ RCRA/Wetlands). At Alorica, the nation’s fastest-growing BPO, John worked in tandem with some of the largest banks in the U.S., helping to evaluate financial risks. He holds Bachelor’s and Master’s Degrees in History from the University of New Orleans, a Juris Doctorate from Loyola University New Orleans and is a licensed attorney in the State of Louisiana. In addition to being one of our featured authors, John has recently taken over the editor role for C/A’s Access magazine. As a hotline advisor, John helps C/A members with a wide range of regulatory and compliance. Occasionally a fee will need to be increased due to inaccurate information relied on by the bank when issuing the Loan Estimate. This situation is referred to as a changed circumstance, change in circumstance, or change of circumstance. Regardless of what it is called when this occurs, for the bank to pass this increase off to the applicant, the bank must send a revised Loan Estimate within three business days of learning of the increase in the fee, using the definition of business day. For the purposes of loan closing, any revised Loan Estimate must be received no later than four business days prior to loan closing. This definition of business day includes all calendar days other than Sundays and legal public holidays. This is sometimes called the “specific definition of business day.” However, since this is a receipt requirement and not a sending requirement, it is important to point out that a TRID disclosure is considered to be received three business days after it is sent, using the definition that includes all calendar days other than Sundays and legal public holidays. The Closing Disclosure (Contents: 1026.38; Timing: 1026.19(f)) Before closing a loan, the bank must send the Closing Disclosure to the applicant. The closing disclosure must be received at least three business days prior to loan closing, using the definition that includes all calendar days other than Sundays and legal public holidays. If there is a change to the loan such that the APR becomes inaccurate, there is a prepayment penalty added, or there is a change in loan product, the bank is required to provide a revised Closing Disclosure to the applicant. This Closing Disclosure must be received at least three business days prior to closing, using the definition that includes all calendar days other than Sundays and legal public holidays. After closing a loan (but within the 30 calendar day period following closing), an