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#2037025 - 09/03/15 11:56 AM Changed Circumstance - Rate Change
Summer101 Offline
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Joined: Jun 2001
Posts: 644
On our home equity loans, we do not have a signed rate lock agreement with the customer but will honor a rate quoted at time of application. We also offer a 1/4% rate reduction if the borrower signs up for automatic payments. If at the time of application the borrower wants the auto-payment rate reduction but then later decides not to sign up for auto-payments, does that require redisclosure since the quoted rate on the LE will go up? The rate change may affect some fees, but I don't believe a "changed circumstance" event has occured allowing a revised LE since there is no signed "rate lock" agreement. Is this correct?

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TRID - TILA/RESPA Integrated Disclosures Rule
#2037027 - 09/03/15 12:13 PM Re: Changed Circumstance - Rate Change Summer101
Jerod Moyer Offline
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Jerod Moyer
Joined: Oct 2005
Posts: 667
Sioux Falls, SD
Since you don't lock rates, there cannot be a changed circumstance re-disclosure of the LE relative to the rate in your scenario. You will simply provide a CloD that will reflect the actual rate.

Curious, what do you mean relative to this scenario by "The rate change may affect some fees..."?
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#2038327 - 09/14/15 04:41 PM Re: Changed Circumstance - Rate Change Jerod Moyer
Summer101 Offline
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Joined: Jun 2001
Posts: 644
I mis-spoke - the fees won't change. Thank you for your response

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#2038404 - 09/14/15 07:54 PM Re: Changed Circumstance - Rate Change Summer101
river girl Offline
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Joined: Nov 2004
Posts: 1,005
Our equity loans don"t "lock" but rather are the rate as of the date of application.
Does the first LE given have the box checked "yes" and that is the only LE they receive unless there is some other changed circumstance unrelated to the rate.
Yes?

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#2038414 - 09/14/15 08:12 PM Re: Changed Circumstance - Rate Change Summer101
RR Joker Offline
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RR Joker
Joined: Nov 2002
Posts: 20,654
The Swamp
You don't lock so your box will be 'no'.
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#2038765 - 09/16/15 02:32 PM Re: Changed Circumstance - Rate Change Summer101
SaaL Offline
Gold Star
Joined: Mar 2008
Posts: 294
The Texas Hill Country
Regarding whether this is a changed circumstance event, wouldn't this be considered a borrower requested change which would allow for re-disclosure of the LE?
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#2038794 - 09/16/15 02:54 PM Re: Changed Circumstance - Rate Change Summer101
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 78,948
Galveston, TX
A change in the APR alone does not trigger a new LE.
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#2038826 - 09/16/15 03:47 PM Re: Changed Circumstance - Rate Change Summer101
ComplianceRegs Offline
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Joined: Jan 2013
Posts: 169
If you don't lock rates (mark no on LE rate lock) and they are essentially floating you just use the CD to disclose the actual rate? This appears to be the case even if it is outside of the APR tolerance threshold from what was disclosed on the LE. Even though it seems logical to think you would redisclose this using the LE it appears the reg only requires the actual rate be reflected on the CD.
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