Qs & As on the Integrated Disclosures

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    QUESTION: Jack, on the insurance question, what do you mean by doing an adjustment?
    ANSWER: The estimate for property insurance is in good faith if it is based on the best information reasonably available at the time it is disclosed, even if the amount paid exceeds the amount disclosed in the loan estimate. If the estimate is not based on the best information reasonably available then the estimate is not in good faith therefore the zero tolerance applies. If the amount paid exceeds the amount disclosed in the loan estimate the difference must be refunded.

    QUESTION: If we require an appraisal and customer cannot shop for it, is it subject to 10% or no tolerance?
    ANSWER: A fee paid to unaffiliated third party if the you do not permit the consumer to shop for the service is subject to a 0% tolerance.

    QUESTION: Customers aren’t typically allowed to choose an appraiser or credit bureau or a settlement agent not on the banks approved list so if we disclose an estimate and it happens to be more, since these fall under 0% tolerance does the bank eat the increase in fees?
    ANSWER: The three fees are subject to 0% tolerance (paid to unaffiliated third party, did not permit to shop). If the actual charge exceeds the estimate the difference must be refunded unless the increase is the result of a changed circumstance, a revision requested by the consumer, or expiration of the original estimate.

    QUESTION: Does this mean that a phone call should be made prior to issuing the estimate in order to have the best information possible?
    ANSWER: The “reasonably available” standard requires that the creditor, acting in good faith, exercise due diligence in obtaining information. The creditor normally may rely on the representations of other parties in obtaining information. For example, the creditor might look to the consumer for the time of consummation, to insurance companies for the cost of insurance, or to realtors for taxes and escrow fees. The creditor may utilize estimates in making disclosures even though the creditor knows that more precise information will be available by the point of consummation. A phone call or other recent documentation that supports the estimate would be appropriate.

    QUESTION: Would we have to “prove” that we used the best information possible?
    ANSWER: See the answer to the previous question.


    I have a question regarding the IMD and seller assistance.
    We were told that the amount of seller assistance needs to be itemized on the loan estimate and that it needs to be the same exact dollar amount at can the Seller assistance change at closing. For example if the LE indicates that the seller assistance is $15,000 and the closing disclosure indicates the seller assist is $11,500. Do we need to wait an additional 3 days to close?

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