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#1181363 - 05/12/09 04:29 PM
Re: New Reg Z Final Rule - Just Published
Deena
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Joined: Aug 2001
Posts: 7,351
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Don't most of you automatically provide final disclosures regardless of whether or not the APR on the prelim is accurate? The amended rule is the same. If the prelim is accurate, no re-disclosure is required. I suspect we will continue the practice of automatically providing a final.
So....consumer submits application. Within 3-business days (under the existing definition of "business day") we mail a prelim....let's say on August 3rd. Seven business days (using the "more precise business day" definition) from August 3rd would be August 11. So that would be the legal consummation date. With that knowledge, we could provide the final disclosure on August 7th (allowing 3 business days "new def") to be able to close on August 11th. If we were to mail the final, we would have to mail it on.........August 4th (allowing the 3 days for mail time). Gack!!!!! I'm going to kill myself.
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#1181425 - 05/12/09 05:01 PM
Re: New Reg Z Final Rule - Just Published
swiggles
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Our Loan ops did some research recently on how often we actually closed on anything above or below tolerance from app to closing disclosures. There were zero instances in a 2-3 month review. We don't feel this will affect us all that often unless entire terms are changed.
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#1181429 - 05/12/09 05:04 PM
Re: New Reg Z Final Rule - Just Published
RR Joker
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Joined: Aug 2001
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Our Loan ops did some research recently on how often we actually closed on anything above or below tolerance from app to closing disclosures. There were zero instances in a 2-3 month review. We don't feel this will affect us all that often unless entire terms are changed. But if the loan amount changes, or perhaps the customer chooses to add credit insurance, wouldn't you re-disclose even if the APR is within tolerance?
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The more you sweat in training, the less you bleed in battle.......
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#1181442 - 05/12/09 05:15 PM
Re: New Reg Z Final Rule - Just Published
swiggles
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Yes, but you wouldn't have to wait. That's all I meant. We do early and final TILs routinely.
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My opinion only. Not legal advice. Say you'll haunt me - Stone Sour
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#1181760 - 05/12/09 07:47 PM
Re: New Reg Z Final Rule - Just Published
RR Joker
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Joined: Jul 2007
Posts: 305
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Just a quick question- Am I correct that the seven business day waiting period is in addition to the three business day right of recission period?
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#1181772 - 05/12/09 07:52 PM
Re: New Reg Z Final Rule - Just Published
dottiec
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right...wait 7 to close, then if it's subject to RoR you close and don't disburse until after 3.
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My opinion only. Not legal advice. Say you'll haunt me - Stone Sour
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#1181796 - 05/12/09 08:01 PM
Re: New Reg Z Final Rule - Just Published
RR Joker
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Joined: Nov 2001
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FINALLY ABOVE the gnat line
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If you wait the 3 business days to provide the early TIL then it could be 13 business days before the customer actually receives their money! AND if you get to the end of the 7 days and discover that the APR is out of variance and you must redisclose, you have 3 more days - unless you mail and then you have 6! Isnt' life fun?!
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#1181804 - 05/12/09 08:06 PM
Re: New Reg Z Final Rule - Just Published
waldensouth
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wonderful...this is going to go over like a lead balloon when we really have to start it.
One thing tho, it may encourage the way it used to be...disclose while they are in front of you or be sure and mail it same day!
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My opinion only. Not legal advice. Say you'll haunt me - Stone Sour
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#1181888 - 05/12/09 09:07 PM
Re: New Reg Z Final Rule - Just Published
RR Joker
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Joined: Jan 2005
Posts: 375
NM
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I need one clarification: Does the MDIA cover both the TIL and the GFE or just TIL?
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#1181892 - 05/12/09 09:15 PM
Re: New Reg Z Final Rule - Just Published
Denovo Co
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Member
Joined: Jun 2004
Posts: 69
Nebraska
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Just the TIL. This is only a Reg. Z amendment.
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#1181896 - 05/12/09 09:22 PM
Re: New Reg Z Final Rule - Just Published
waldensouth
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Joined: Aug 2001
Posts: 7,351
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If you wait the 3 business days to provide the early TIL then it could be 13 business days before the customer actually receives their money! AND if you get to the end of the 7 days and discover that the APR is out of variance and you must redisclose, you have 3 more days - unless you mail and then you have 6! Isnt' life fun?! Not necessarily. The earliest closing date is 7 business days from the date you deliver or mail the Prelim (Saturdays are business days). But if the loan is approved and the Final TIL is delivered early within those seven days (and it's correct), the seventh day could possibly be your closing date. In other words, the 7 days and 3 days can occur simultaneously. Then close and wait until the end of the rescission period to fund. We usually approve home improvement loans and home equity loans fairly quickly. I anticipate providing the final so early within the 7-day period that the 3-day period will expire within the 7-day period, but we'll still have to wait for that 7th day before we can close. My head is spinning.
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The more you sweat in training, the less you bleed in battle.......
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#1181966 - 05/13/09 03:01 AM
Re: New Reg Z Final Rule - Just Published
Denovo Co
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Joined: May 2002
Posts: 6,259
NW IL
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I need one clarification: Does the MDIA cover both the TIL and the GFE or just TIL? But in my reading this evening, which I did on the bike while at the gym (for 50 minutes!), it does say on page 26 that the Board tried to make terms between the 2 regs synonymous and we can continue to send them together. It all could have been worse. Did any of you see all the times, in the waiver section on pages 16 and 17, that it said "the board does not agree with consumer advocates' interpretation of the statute..."? One more thing that caught my eye, on page 10 where it mentions that corrected disclosures are not required if we had overstated the APR? Would this or could this happen anymore, given the RESPA changes that are coming? If our GFE's have to be more and more accurate, wouldn't too our APR calculations? Or did I just muddy this all up?
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#1182003 - 05/13/09 12:06 PM
Re: New Reg Z Final Rule - Just Published
swiggles
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Joined: Nov 2001
Posts: 7,984
FINALLY ABOVE the gnat line
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My example was worst case scenario - where you wait to provide the 1st TIL for the 3 days. Your final TIL must be separate from your note - ours is included in the note so it is received at closing.
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"Once you learn to read, you will be forever free." - Frederick Douglass
My Opinion Only.
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#1182016 - 05/13/09 12:25 PM
Re: New Reg Z Final Rule - Just Published
Jerod Moyer
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Joined: Aug 2005
Posts: 914
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I am confused on the rules when you mail the early TIL. Are they saying that your 7 days do not start to run until 3 business days after the early disclosures are mailed?
Also, all of this only applies if RESPA applies too, right?
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#1182028 - 05/13/09 12:45 PM
Re: New Reg Z Final Rule - Just Published
Sage
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Joined: Nov 2005
Posts: 614
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No- the 7 days start when you place the ETIL in the mail. It is the redisclosure that you have to wait 3 days to start the additional 3 days if you mail it.
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#1182063 - 05/13/09 01:06 PM
Re: New Reg Z Final Rule - Just Published
Sage
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I am confused on the rules when you mail the early TIL. Are they saying that your 7 days do not start to run until 3 business days after the early disclosures are mailed?
Also, all of this only applies if RESPA applies too, right? I know your questions have been partly answered, but to more fully answer them: Your intial TIL count starts when you deliver or place in the mail. Only if you re-disclose and mail the corrected disclosure to you have to assume a 3-day mail to receipt date. Yes, this applies to RESPA-related transactions.
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My opinion only. Not legal advice. Say you'll haunt me - Stone Sour
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#1182146 - 05/13/09 01:41 PM
Re: New Reg Z Final Rule - Just Published
swiggles
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Gold Star
Joined: Jul 2007
Posts: 305
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If you wait the 3 business days to provide the early TIL then it could be 13 business days before the customer actually receives their money! AND if you get to the end of the 7 days and discover that the APR is out of variance and you must redisclose, you have 3 more days - unless you mail and then you have 6! Isnt' life fun?! Not necessarily. The earliest closing date is 7 business days from the date you deliver or mail the Prelim (Saturdays are business days). But if the loan is approved and the Final TIL is delivered early within those seven days (and it's correct), the seventh day could possibly be your closing date. In other words, the 7 days and 3 days can occur simultaneously. Then close and wait until the end of the rescission period to fund. We usually approve home improvement loans and home equity loans fairly quickly. I anticipate providing the final so early within the 7-day period that the 3-day period will expire within the 7-day period, but we'll still have to wait for that 7th day before we can close. My head is spinning. I don't see how that works. The final rule requires us to deliver or mail the early disclosures to the consumer not later than the seventh business day before consummation. Reg Z defines consumation as when a contractual obligation on the consumer's part is created. It goes on to describe it as a contractual commitment that binds the customer to the credit terms. When they sign the loan documents they have bound themselves to the credit terms.
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#1182184 - 05/13/09 02:06 PM
Re: New Reg Z Final Rule - Just Published
dottiec
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I don't see how that works. The final rule requires us to deliver or mail the early disclosures to the consumer not later than the seventh business day before consummation. Reg Z defines consumation as when a contractual obligation on the consumer's part is created. It goes on to describe it as a contractual commitment that binds the customer to the credit terms. When they sign the loan documents they have bound themselves to the credit terms. I'm not following this logic?!?
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My opinion only. Not legal advice. Say you'll haunt me - Stone Sour
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#1182202 - 05/13/09 02:17 PM
Re: New Reg Z Final Rule - Just Published
RR Joker
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Joined: Jul 2007
Posts: 305
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Hopefully this will clarify my question-
At our bank, the customer signs all loan documents, including the final TIL and the Right of Recission at the same time. The customer becomes obligated to the credit terms at that time. They then have the right to rescind until midnight of the third business day following consumation as required in part 226.23.
In this case, if we are required to give the Early TIL and wait seven days before consummation, how can the 7 day waiting period and the three day ROR run simultaneously?
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#1182212 - 05/13/09 02:23 PM
Re: New Reg Z Final Rule - Just Published
dottiec
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Joined: Aug 2001
Posts: 7,351
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Hopefully this will clarify my question-
At our bank, the customer signs all loan documents, including the final TIL and the Right of Recission at the same time. The customer becomes obligated to the credit terms at that time. They then have the right to rescind until midnight of the third business day following consumation as required in part 226.23.
In this case, if we are required to give the Early TIL and wait seven days before consummation, how can the 7 day waiting period and the three day ROR run simultaneously? The ROR cannot run simultaneously with the 7-day waiting period. But the 3 day period after providing the final TIL can. For example: Application received: August 3 Prelim mailed: August 6 (7 days will be Aug 14 - earliest possible closing date) Loan approved and Final delivered: August 11 (3 days will be August 14 - closing date) The 7 day period and the 3 day period have occurred simultaneously. Close the loan on August 14, and ROR period begins at that time. The final TIL and the ROR will be signed 3 days apart.
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The more you sweat in training, the less you bleed in battle.......
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#1182243 - 05/13/09 02:42 PM
Re: New Reg Z Final Rule - Just Published
swiggles
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Joined: Aug 2001
Posts: 7,351
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I would assume that in many instances the borrower WOULD sign the final truth in lending disclosure AT consummation. The regulation states that the disclosure must be "given" or "disclosed" (not signed) 3 days prior to consummation. As long as the institution retains proof that the customer was provided with the disclosure at least three days prior to closing, it would be OK to have the disclosure actually signed at closing? We use Laserpro for loan documents. Currently, our disclosure statement (above the sig line) states: "I read and was given a completed copy of this Disclosure Statement on [date], prior to signing the Note." The [date] is hard coded into the document as the loan date. That's not going to work!
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#1182248 - 05/13/09 02:47 PM
Re: New Reg Z Final Rule - Just Published
swiggles
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and...you will only need to worry about that additional 3/6 days IF the final TIL is going to be out of tolerance from the early TIL. RofR is a "whole nother" waiting game!
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My opinion only. Not legal advice. Say you'll haunt me - Stone Sour
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#1182264 - 05/13/09 02:55 PM
Re: New Reg Z Final Rule - Just Published
RR Joker
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Joined: Aug 2001
Posts: 7,351
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and...you will only need to worry about that additional 3/6 days IF the final TIL is going to be out of tolerance from the early TIL. RofR is a "whole nother" waiting game! Yup, joker, true.....but I'm still too scared to try that route. We will be automatically providing a final TIL just like we always have......will not be testing for tolerance.
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