Removing Barriers Blog

CUNA Supports Proposed Removal of TRID’s “Four-Business Day Limit”
Posted October 11, 2017 by CUNA Advocacy

Yesterday, CUNA filed a letter with the CFPB in support of a proposal to remove the “four-business day limit” from the TILA-RESPA Integrated Disclosures (TRID) rule under Regulation Z. The four-business day limit dictates, based on timing, the method by which a lender may disclose a revised estimate of closing costs to the consumer. 

The proposal is intended to address confusion in the market about the timing requirements related to issuing revised disclosures—the Closing Disclosure in particular—for purposes of resetting tolerances. To address this confusion, the proposal would amend Reg Z as it relates to when a creditor may use a Closing Disclosure, instead of a Loan Estimate, to determine if an estimated closing cost was disclosed in good faith and within the permissible tolerance. The proposed amendments would permit creditors to do so regardless of when the Closing Disclosure is provided relative to consummation. Specifically, the proposal would amend the TRID rule by removing the four-business day limit for providing Closing Disclosures for purposes of resetting tolerances and determining if an estimated closing cost was disclosed in good faith. 

While the conflict caused by the four-business day limit described by the Bureau does not appear to be a major issue for most credit unions, we believe its removal, as proposed, would help clarify the disclosure process associated with resetting tolerances in certain, limited circumstances.