RESPA closing disclosure timeline, the TRID rule, and settlement cost disclosure requirements tested on the SAFE Act exam.
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- What does RESPA stand for?
- Real Estate Settlement Procedures Act
- What is the primary purpose of RESPA?
- To ensure consumers receive clear, timely information about settlement costs and prevent kickbacks
- What does TRID stand for?
- Truth in Lending and Real Estate Settlement Procedures Act
- When did the TRID rule take effect?
- October 3, 2015
- How many business days before closing must a Closing Disclosure be provided?
- At least 3 business days
- What is the Closing Disclosure form?
- A final settlement statement disclosing all charges and terms of the mortgage transaction
- If material changes occur after Loan Estimate issuance, what must happen?
- A new Closing Disclosure must be issued with another 3-business-day waiting period
- Can the Closing Disclosure be provided electronically?
- Yes, if the borrower consents to electronic delivery
- What is a Loan Estimate form?
- A form provided within 3 business days of loan application disclosing estimated loan terms and costs
- How many business days can pass between Loan Estimate and closing?
- At least 3 business days must pass
- Can a lender charge more than estimated for any closing cost?
- Only if the cost is in the 10 percent tolerance category
- Which closing costs have zero cost tolerance and cannot increase?
- Interest rate lock fees, lender title policy insurance, transfer taxes, and HOA transfer fees
- Which closing costs can increase up to 10 percent if underestimated?
- Property appraisal, credit report, flood determination, title search, and title insurance
- Who is subject to RESPA requirements?
- Lenders, mortgage brokers, settlement service providers, and title companies
- When must an affiliated business arrangement disclosure be given under RESPA?
- Within 3 business days of loan application
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