Exam MLO Topic 1 Question 76 Discussion

Under the TILA-RESPA Integrated Disclosure (TRID) rules, any significant change to the Annual Percentage Rate (APR) beyond the allowed tolerance before closing requires the lender to provide a revised Closing Disclosure (CD). If the APR increases by more than 0.125% for fixed-rate loans, the lender must re- disclose the CD and provide the borrower with at least three business days to review the updated terms before consummation (closing).
* In this case, the interest rate increase from 3.250% to 3.875% is a significant change that impacts the APR, triggering the need for re-disclosure and the mandatory three-business-day waiting period.
* The lender must postpone the closing until the new three-day waiting period passes to ensure compliance with TRID regulations.
References:
* TILA-RESPA Integrated Disclosure Rule (TRID), 12 CFR §1026.19(f)
* CFPB TRID Guidelines