My vote is with Adam on this. Here's the last part of updated comment 19(e)(3)(iii)-2:
"If the creditor permits the consumer to shop consistent with § 1026.19(e)(1)(vi)(A) but fails to provide the written list required under § 1026.19(e)(1)(vi)(C), good faith is determined under § 1026.19(e)(3)(ii) instead of § 1026.19(e)(3)(iii) unless the settlement service provider is the creditor or an affiliate of the creditor in which case good faith is determined under § 1026.19(e)(3)(i). As noted in comment 19(e)(1)(vi)-1 whether the creditor permits the consumer to shop consistent with § 1026.19(e)(1)(vi)(A) is determined based on all the relevant facts and circumstances."
The last sentence is critical. Obviously, you would have to have included the service in section C of the loan estimate, or there's no way you can claim that shopping was allowed. And then, other "relevant facts and circumstances" will determine whether your argument will hold water.
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John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8