A webinar speaker told us today that if we fail to disclose HO on the LE, it becomes a 0 tolerance item because it violates the requirement to disclose in good faith. Would it be subject to 0% or 10% tolerance because of failure to disclose a fee that is ordinarily not subject to a tolerance?

It might be a 'good faith' violation if you require it because it doesn't exist and then didn't estimate it, but going to zero or 10% tolerance? No...I don't think that is correct.

Agree with Joker......violation for not disclosing on LE, but i wouldn't treat it as 0% tolerance as a result.

Agree. That's a little extreme and to the best of my knowledge that is not outlined anywhere in the reg/proposed rule.

I'd be contacting that webinar speaker and asking for the citation to support their statement.
Betting you don't get one but if you do, please be sure to share it here.

It is those three little iii in the last sentence below, referring the reader to the no tolerance section, that makes it clear to me. Thanks for the feedback.

1026.19(e)(3)(iii) Variations permitted for certain charges. An estimate of the following charges is in good faith if it is consistent with the best information reasonably available to the creditor at the time it is disclosed, regardless of whether the amount paid by the consumer exceeds the amount disclosed under paragraph (e)(1)(i) of this section:

(B) Property insurance premiums;

19(e)(3)(iii) Variations permitted for certain charges.

1. Good faith requirement for prepaid interest, property insurance premiums, and escrowed amounts. For example, if the creditor requires homeowner's insurance but fails to include a homeowner's insurance premium on the estimates provided pursuant to § 1026.19(e)(1)(i), then the creditor's failure to disclose does not comply with § 1026.19(e)(3)(iii).

Section 1026.19(e)(3)(iii) deals with exceeding the amount disclosed. If you don't disclose an amount at all, then it is a problem from a good faith standpoint, as mentioned by others above. I don't believe there are tolerance implications because of this failure though. I would expect an examiner to cite a technical TRID violation though.

That's true Justin that the section is about comparison to the LE. (would be nothing to compare it to) So far, we haven't had this happen.