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Early Disclosure Wrong, Closing Correct, What Now

During a post closing audit we discovered that an ARM APR which was incorrectly disclosed in the preliminary TIL but was correct on the final TIL. Is there anything we need to do to correct the preliminary disclosure or are we compliant because the final TIL was correct?

Dan Persfull - You are compliant if the final TIL is correct. However, if there were no material changes in the loan request I would certainly investigate and correct the cause of the early TIL being inaccurate.

Andy Zavoina - To further Dan's comments, if the initial TIL had a lower APR and this was seen more than once, I would certainly determine why this was happening. If rates, fees or other charges were being habitually understated initially, this may be viewed as a bait and switch manuver and an unfair or deceptive act.

First published on 4/18/05

First published on 04/18/2005

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