Correction 10/27/2016: This article, initially posted on Wednesday, October 26th, 2016, included the designation “Eastern” in the first two paragraphs. All references to the designation “Eastern” have been removed from these paragraphs.
It’s that time of year again. Daylight Saving Time, or Daylight Time (DT), ends on November 6, 2016 at 2:00 a.m. If your financial institution is in an area that observes Daylight Savings Time, ensure the time zone designation is updated to reflect Standard Time (ST) on your TRID disclosures.
Under the TRID rules in Regulation Z, when an interest rate is locked creditors must disclose the date and time (including the applicable time zone) the interest rate lock and estimated closing costs will expire. As a result, financial institutions located in areas that observe DT must remember to change the time zone designation under the Rate Lock section on their loan estimates back to ST.
Verify that your loan origination software updates the time zone designation properly. In addition, loan estimates issued during the period just prior to the change may expire after the time zone designation has changed and lenders should ensure the rate lock section reflects the time zone in effect on the date of expiration. For example, if a lender in the Eastern time zone delivers a loan estimate while EDT is in effect and the interest rate lock and estimate of closing costs expire after the time reverts back to EST, the lender must show the expiration time zone as EST since that will be the time zone designation in effect when the rate lock and estimated closing costs expire.
This is a small item that can be easily overlooked; it is also an easy violation for an examiner to identify. Please take a few minutes to make sure your disclosures have the correct time zone.