TRID Flashcards

1
Q

What does TRID stand for?

A

TILA RESPA Integrated Disclosure Rule

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

What regulation(s) does TRID association with?

A

Regulation Z & X

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

What is the regulatory agency for TRID?

A

Board of Governors of the Federal Reserve (FRB)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Who administers and enforces TRID?

A

Consumer Financial Protection Bureau

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

What is the purpose of TRID?

A
  • 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
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

What is a change of circumstance?

A

When the terms or costs of the loan change due to information provided by the borrower in good faith is incomplete or inaccurate

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

The Loan Estimate (LE) is a combination of what two forms?

A

Good Faith Estimate (GFE) & Truth-in-Lending (TIL) disclosures

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

When must the initial LE be delivered?

A

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 well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

How soon can the loan close after delivery of the initial LE?

A

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

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

When must the revised LE be delivered? Provide two requirements.

A
  • 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
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Terms on the LE must be valid for how many days?

A

10 business days

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

When is a revised Loan Estimate required to be sent to the borrower? Name three causes…

A
  • 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
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

What are three (3) examples of a changed circumstance?

A
  • Extraordinary or unexpected events;
  • Information relied upon by the creditor was determined to be inaccurate or changes after the LE is provided;
  • New information
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

There are three (3) limiting categories on fees contained within the Loan Estimate. What are the categories?

A
  • Zero tolerance fees;
  • 10% tolerance fees;
  • Unlimited tolerance fees
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

What are some examples of “zero tolerance fees”?

A
  • 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
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

What are some examples of “10% tolerance fees”?

A
  • 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;
17
Q

What are some examples of “unlimited tolerance fees”?

A
  • 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
18
Q

What is the purpose of the Closing Disclosure (CD)?

A

To provide disclosures that help the consumer understand the costs of the transaction

19
Q

The Closing Disclosure (CD) is a combination of what two forms?

A

The HUD-1 & the final TIL disclosures

20
Q

When must the CD be delivered to the borrower?

A

The consumer must receive the CD at least 3 business days prior to the closing of the loan

21
Q

When is a revised CD required to be sent to the borrower?

A

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
22
Q

When can the loan close after a revised CD is provided to the borrower?

A

After 3 business days

23
Q

What are the record retention requirements for the Loan Estimate (LE)?

A

3 years

24
Q

What are the record retention requirements for the Closing Disclosure (CD)?

A

5 years

25
Q

What loans are exempt from TRID?

A
  • Open-end loans such as HELOCs; and
  • Reverse Mortgages (HECM); and
  • Loans on mobile homes not attached to a permanent foundation (Chattel)
26
Q

Name 5 fees that affect calculation of the APR.

A
  • Loan origination fee - Loan discount fee
  • Loan commitment fee - Borrower paid broker fees
  • Processing fees - Underwriting fee
  • Tax service fee - Flood certification fee
  • Escrow waiver fee - Assumption fee
  • Prepaid interest - Courier fees
  • MIP/PMI - Credit life premiums
  • Accident, health or Loss of Income (LOI) insurance
  • Closing fees, including attorney’s fees
  • Service, transaction, activity and carrying fee
  • Loan fees, finder’s fees and similar charges
27
Q

Name 5 fees that DO NOT affect calculation of the APR.

A
  • Credit reports (for mortgage)
  • Points and fees paid by the seller
  • Application fees
  • Fees for document preparation
  • Fees for title examination, abstract or property survey
  • Notary
  • Recording fees
  • Well and septic inspection fees
  • Final inspection fee
  • Flood hazard inspection
  • Amounts required for escrow accounts
  • Any escrow fee for cushion
  • Appraisal
28
Q

How many sections (tabs) are on the CD?

A

Fourteen (14)

Page One:
      (1) Loan Terms
     (2) Projected Payments
     (3) Costs at Closing
Page Two:
     (4) Loan Costs
     (5) Other Costs
Page Three:
     (6) Calculating Cash to Close
     (7) Summaries of Transactions
Page Four:
     (8) Loan Disclosures
     (9) Adjustable Payment (AP) Table
     (10) Adjustable Interest Rate (AIR) Table
Page Five:
     (11) Loan Calculations
     (12) Other Disclosures
     (13) Contact Information
     (14) Confirm Receipt
29
Q

How many sections (tabs) are on the LE?

A

Nine (9)

Page One:
      (1) Loan Terms
     (2) Projected Payments
     (3) Costs at Closing
Page Two:
     (4) Loan Costs
     (5) Other Costs
     (6) Calculating Cash to Close
Page Three:
     (7) Comparisons
     (8) Other Considerations
     (9) Confirm Receipt