• The “early” TILA disclosures must be delivered or placed in the mail not later than 3 business days after the creditor receives the consumer's written application, and at least 7 business days before consummation of the transaction. This is a new “waiting period.”
For the above purpose “business days” include each day (other than Saturday or Sunday)
• If the annual percentage rate (“APR”) on the “early” disclosure becomes inaccurate, by increasing or decreasing beyond established tolerance levels, the creditor must now make corrected disclosures to the consumer with a revised APR. The consumer must receive the corrected disclosures no later than 3 business days before consummation.
The APR is considered accurate for a regular transaction if it is not more than 1/8 of 1 percentage point above or below the actual annual percentage rate.
What does this mean?
1. There is no more closing a loan within 7 business days of application. So if a loan falls out from a lender and gets transferred to another lender, the minimum waiting period is 7 business days before you can close with the new lender.
2. If any of the fees change on the final settlement statement to a great enough extent compared to the GFE that was signed by the borrower at time of application (increase OR decrease in fees), a new TIL disclosure will have to be generated and you have to wait 3 more days before you can close. So a lender can’t have a higher or lower rate by more than .125% at closing AND the lender fees can’t go up or down by more than a couple of hundred bucks or you will have to wait another 3 days. Lender credits of any significant amount will cause a 3-day delay, even if it benefits the borrower.
Mike Ouverson
Senior Mortgage Consultant
13875 Hwy 13 S • Savage, MN 55378
Cell: 612-202-8321 • Fax: 952-487-2325
mouverson@landmarqlending.com • www.EMortgageExperts.com
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