If an applicant chooses a different service provider (title company) other than what we provide on the LE, is this considered a changed circumstance and are we required to re-disclose the LE showing the fees from the title company that the applicant chose? Or does it only need to be reflected on the Closing Disclosure? (Any regulation references are appreciated)

No - it is not a changed circumstance. If you know what the charges are going to be, then you would update the charges on the next disclosure issued in order to maintain "good faith" disclosure principles.

This means they have chose to "shop" for the provider of the required service. As Randy stated, that act alone (based on the stated facts) is not a changed circumstance. However, if you for some reason you end up providing a revised LE you would need to update the title related fees based on the "good faith" standard. In short:

Any revised disclosure (to reset tolerances and/or for informational purposes) issued …must be based on the best information reasonably available to the creditor at the time they are provided to the consumer… For example, if the creditor issues revised disclosures reflecting a new rate lock extension fee… other charges unrelated to the rate lock extension must be reflected on the revised disclosures based on the best information reasonably available to the creditor at the time the revised disclosures are provided. Nonetheless, any increases in those other charges unrelated to the rate lock extension (the legitimate changed circumstance) may not be used… to determine either the 0% or 10% tolerances. [Commentary to §1026.19(e)(3)(iv) #5]