Know Before You Owe (KBYO or TRID)

This is subject to state law. You will need to rely on guidance from your legal counsel or compliance experts to determine the consummation date for purposes of each state in which you do business.

See also the previous question and response in this FAQ.

The rule allows for one or separate disclosures regarding loans with multiple advances for financing the construction of a dwelling. The policy on such disclosures should be established by your legal counsel or compliance experts for your organization.

This will vary by state for those limited states that may address consummation date. There are many states where this date is not clearly defined (when the consumer becomes obligated on the loan). You will need to rely on guidance from your legal counsel or compliance experts to determine the consummation date for purposes of each state in which you do business. That being said, the general consensus of settlement agents and title companies is that in lieu of clarification by every state the consummation date will be the date of the signing of the Note or credit agreement.

Assuming the question is posed by a mortgage broker, then yes, it is acceptable to leave the Loan ID field blank if the creditor is unknown when the mortgage broker delivers the Loan Estimate. This is not the case when a Loan Estimate is issued by the creditor. The Closing Disclosure in all cases must have a Loan ID.

The HUD-1 and TIL Statement would only be used for transactions exempt from the rule. In terms of the Note and Mortgage there are cases, particularly regarding security instruments (Mortgage, Deed of Trust), where these instruments reference provisions under RESPA or TILA that may not be applicable under the new rule. You will need to analyze the instruments (as well as state specific disclosures) for such references (including references to the Good Faith Estimate, Truth in Lending Statement, and HUD-1) for necessary revisions to these documents, as well as working with your document providers regarding any necessary revisions to the documents for your organization. Many states have not made revisions either via the legislative process or via regulatory revision by the state agencies. You will need to work with your legal counsel or compliance experts to determine how these documents and disclosures should be modified for your purposes.

Regulation Z only addresses the Loan ID number relative to the Loan Estimate and Closing Disclosure. It does not address Loan ID numbers for purposes of investor purchasing, servicing, etc., once the Closing Disclosure has been delivered.

It is recommended that in this case you (or an agent on your behalf, such as the settlement agent or title company) ascertain the actual recording fees when the documents are submitted for recording, in lieu of waiting until the document is actually recorded.

Whether or not settlement agents and attorneys obtain a software program to generate the disclosures is completely up to them. If they are generating the disclosure and delivering them to the consumer then they are doing so on the creditor’s behalf. The creditor is responsible for compliance when delivering the disclosures and the content contained within them.

It depends on whether or not the transaction is rescindable. Commentary ¶17(d)-2, states “When two consumers are joint obligors with primary liability on an obligation, the disclosures may be given to either one of them. If one consumer is merely a surety or guarantor, the disclosures must be given to the principal debtor. In rescindable transactions, however, separate disclosures must be given to each consumer who has the right to rescind under §1026.23, although the disclosures required under §1026.19(b) need only be provided to the consumer who expresses an interest in a variable rate loan program. When two consumers are joint obligors with primary liability on an obligation, the early disclosures required by §1026.19(a), (e), or (g), as applicable, may be provided to any one of them. In rescindable transactions, the disclosures required by §1026.19(f) must be given separately to each consumer who has the right to rescind under §1026.23. In transactions that are not rescindable, the disclosures required by §1026.19(f) may be provided to any consumer with primary liability on the obligation.”

Just to clarify, the Closing Disclosure must be received by the appropriate consumers a minimum of three specific business days prior to the loan closing (also don’t forget the seven specific business day waiting period from delivery of the initial Loan Estimate). There is an allowance for waiving this requirement for a bona fide personal financial emergency only. It is recommended you use caution in applying this waiver in particular if you sell loans on the secondary market, since it is a rare occurrence for such a waiver to be acceptable to investors.

Yes, in the case of a bona fide personal financial emergency. It is recommended you use caution in applying this waiver in particular if you sell loans on the secondary market, since it is a rare occurrence for such a waiver to be acceptable to investors.