Our offices are not open for business on Saturdays or Sundays; however, one workaholic loan officer took an application over the phone this past Sunday. This morning I noticed the loan had not been disclosed and questioned her about it. She stated that she believed she had until today to disclose since Saturday and Sunday do not count in our initial disclosure period. She is basically treating the file as if it was received Monday. My instinct says this file should be treated as if it was received on Friday; however, I don't want to be too conservative since my opinion would mean the file is out of compliance. I would greatly appreciate your opinions and approaches to this situation!

I would consider it received Monday. It truly did not exist to begin a count on Friday.

(iii) Timing. (A) The creditor shall deliver or place in the mail the disclosures required under paragraph (e)(1)(i) of this section not later than the third business day after the creditor receives the consumer's application, as defined in § 1026.2(a)(3).

But wouldn't Wednesday be the third business day after the application was received?

Yeah, i don't see anything that says an application can't be received on a non-business day. Normally, Sunday wouldn't be in play because banks aren't open on Sunday.....but if the LO did receive it on Sunday, then i'd think your LE would need to be out by Wednesday. JMO.

I agree and apologize for not completing my thought above. I should have said Monday would start your count as Day 1.

An electronic application that hits the bank over the weekend or after hours on a weekday (when no MLO is here to receive it) would be considered "received" the next business day then - even though the electronic date/time stamp shows it received on non-business hours.

I think that's different though....in this case, there WAS an MLO there to receive it on that Sunday.

Yes - our LO took the app over the phone from home on Sunday.
Thank you all for your input!

My understanding is that the receipt of the online application is based on the date and time stamp. You have to treat the application as received that day, regardless of no MLO being around to receive it. I see this as similar to having an office where the employees leave at 5 PM and the mail didn't arrive until at 6 PM that day. You can't just say, "Oh, nobody was around to receive the mail, so the LE clock doesn't start until the next business day."

On what do you base that understanding, JPC? I agree that an application received on a bank business day is treated as received that day, but if it's not a business day, how would the "clock" start ticking on that non-business day? Every discussion I have had on this question addressed the problem caused by an application delivered to an MLO when he or she is away on a business day (such as on vacation or out ill) and pointed out the need for backing up absentees. They haven't looked at non-business day receipt of applications.

I agree. An emailed application that hits the bank on a Sunday (when no one is there) does not have to be marked as received on Sunday for TRID timing purposes.

And to add to John's response...another issue is an application being sent to an LO's email address and them being out or just not checking regularly. Big problem!

having an office where the employees leave at 5 PM and the mail didn't arrive until at 6 PM that day. You can't just say, "Oh, nobody was around to receive the mail, so the LE clock doesn't start until the next business day."

That's exactly what I would say.

Sorry, all, I didn't clarify what I meant by my comment. I was talking about in situations where the online application came in on a business day. I agree if it comes in on a Saturday or Sunday or holiday or other day that is not a general business day for the institution, then the clock does not start that day. However, it is my understanding that if it has a date stamp/time stamp on a Tuesday, for example, when it is a business day for a creditor, then the clock does start if it is received before midnight, as that is the day the application is received.

[The creditor shall deliver or place in the mail the disclosures required under paragraph (e)(1)(i) of this section not later than the third business day after the creditor *receives* the consumer’s application, as defined in § 1026.2(a)(3).]

This would also be my understanding if the application is received in the mail "after hours" on a business day.

The difficultly here is there in really no guidance, other than affirming that the 6 pieces constitutes an application, as to when the creditor is considered to have "received" the application from the borrower.

If the argument that an emailed application received by the bank's mail server at 1 p.m. Sunday (a non-business day) is to be treated as received on the next business day is acceptable, then it's really a no-brainer to say that the same application received by the email server at 10 p.m. on Tuesday (five hours after the end of business hours) is to be treated as received on Wednesday, the next business day.

In both instances, the mail server received the application during non-business hours and no one is expected to field the application until the next business day. I cannot understand how the two scenarios can be viewed differently.

The difference to me is that one is a business day and one is not. Just as you don't count a non-general business day in order to meet the timing requirements for delivering the LE, I wouldn't expect a non-general business day to counted when determining receipt of the application by the creditor.

Let's flip the scenario and out the shoe on the other foot, so to speak. Let's say the creditor received an application on Monday, so the LE has to be issued by Thursday. If the customer consented to receiving documents electronically, and the creditor (for whatever reason) sent the document package with the LE at 10:30 PM on Thursday night. This is date and time stamped in the LOS of the creditor. Would you consider the creditor to have met their TRID timing requirements, even though this is a time when the consumer would normally be asleep, or not within the business hours of the Bank?

I appreciate the feedback. I am definitely open to being swayed from my opinion on this one. I just remember researching this extensively previously (I thought we even all discussed it in another thread) and the conclusion I came up with is you have to start the clock when received, even if after hours.

There is no definition of "received" when it comes to the creditor, so it's an interpretation either way to some extent.

No, I would not.

We are going to have to disagree, JPC. I just think you are making meeting the timing requirement for delivery of the LE more difficult than it needs to be.

Common sense should really prevail in this instance.

@RR - I would consider it met.

@John - I don't know if I necessarily disagree with you. I just wanted to flesh out the discussion. I could see both arguments being valid.

As a former examiner, the use of common sense isn't always the way we looked at compliance. It was by a literal and textual interpretation/understanding of the Regulation, which is what I fear a creditor could run into by relying on the after hours response. Kind of like requiring flood insurance on some dilapidated outhouse that nobody uses anymore, but makes up a part of a non-residential property in a flood zone. Common sense says why get insurance because it really has no value, but the literal requirements of the Regulation demand it (unless you can provide evidence it is uninsurable, worthless, etc.).

We all make own beds on which to lie upon.

JPC I can assure you I don't typically rely on common sense when it comes to regulations, in fact it's rare.

I'm going to 'flip' your scenario right back at you. If you did not have electronic consent and you were mailing the LE...would you consider dropping it in the mail box after the last mail pick up of the day on day 3 compliant?