TRID. Quick Compliance Guide T I L A-RESPA INTEGRAT E D DISCLOSURES Temenos USA. All rights reserved

Transcription

1 TRID T I L A-RESPA INTEGRAT E D DISCLOSURES Quick Compliance Guide Temenos USA. All rights reserved

2 w: temenos.com/tricomply p: e: While the publisher and author have used reasonable efforts in preparing this manual, the publisher and author provide to it to the recipient in its "as-is" condition and without warranty or condition of any kind, including specifically but without limitation any warranty with respect to the accuracy or completeness of the contents of this manual. No warranty may be created or extended by sales representatives or written sales materials. The advice and strategies contained herein may not apply or be suitable for your situation. You should consult with a professional where appropriate. The accuracy and completeness of the information provided herein and the opinions stated herein are not guaranteed or warranted to produce any particular results and the advice and strategies contained herein are not suitable for every individual. By providing information or links to other websites, the publisher and the author do not guarantee, approve or endorse the information or products available at any linked websites or mentioned companies, or persons, nor does a link indicate any association with or endorsement by the publisher or author. This publication is designed to provide information with regard to the subject matter covered. It is licensed with the understanding that neither the publisher nor the author is engaged in rendering legal, accounting or other professional service. If legal advice or other expert assistance is required, the services of a competent professional should be sought. Neither the publisher nor the author shall be liable for any loss or loss of profit or any other commercial damages, including but not limited to special, incidental, consequential, or other damages. THE PUBLISHER AND THE AUTHOR EXPRESSLY DISCLAIM ANY AND ALL IMPLIED WARRANTIES OR CONDITIONS OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND/OR NON-INFRINGEMENT. TriNovus, LLC, a Temenos company 2015.

3 v WHAT IS AN APPLICATION? TILA-RESPA INTEGRATED DISC Quick Compliance Guide LOAN ESTIMATE AND CLOSING D REGULATION REGULATION B (ECOA) REGULATION C (HMDA) REGULATION X (RESPA) REGULATION Z (TILA) DEFINITION An oral or written request for an extension of credit that is made in accordance with procedures used by a creditor for the type of credit requested Does not include the use of an account or line of credit to obtain an amount of credit that is within a previously established credit limit Completed application means an application in connection with which a creditor has received all the information that the creditor regularly obtains and considers in evaluating applications for the amount and type of credit requested Includes, but not limited to, credit reports, any additional information requested from the applicant, and any approvals or reports by governmental agencies or other persons that are necessary to guarantee, insure, or provide security for the credit or collateral Creditor must exercise reasonable diligence in obtaining such information For purposes of rendering an adverse action, if creditor receives enough information to make a credit decision, and it conveys that decision to the applicant, the institution is deemed to have received an application regardless of receipt of an application as defined by the institution Written application required for purchase or refinance of 1-4 principal dwelling and secured by that dwelling An oral or written request for a home purchase loan, a home improvement loan, or a refinancing that is made in accordance with procedures used by an institution for the type of credit requested A request for preapproval for a home purchase loan is an application if the request is reviewed under a program in which the institution, after a comprehensive analysis of the creditworthiness of the applicant, issues a written commitment to the applicant valid for a designated period of time to extend a home purchase loan up to a specified amount Written commitment may not be subject to conditions other than: Conditions that require the identification of a suitable property; Conditions that require that no material change has occurred in the applicant's financial condition or creditworthiness prior to closing; and Limited conditions that are not related to the financial condition or creditworthiness of the applicant that the lender ordinarily attaches to a traditional home mortgage application (such as certification of a clear termite inspection) The submission of a borrower's financial information in anticipation of a credit decision relating to a federally related mortgage loan, which shall include the borrower's: Name Monthly Income Social security number to obtain a credit report Property Address Estimated value of the property Loan Amount, and Any other information deemed necessary by the loan originator May either be in writing or electronically submitted, including a written record of an oral application Lender is not permitted to require, as a condition for providing a GFE, that an applicant submit supplemental documentation to verify the information provided on the application Until October 3 rd, 2015, no definition of an application As of October 3rd, 2015: The submission of a consumer's financial information for purposes of obtaining an extension of credit For transactions subject to TILA-RESPA Integrated Disclosure (TRID) rules, the term consists of the consumer's: Name Monthly Income Social security number to obtain a credit report Property Address Estimated value of the property and Loan Amount Does not prevent a creditor from collecting additional information it deems necessary for credit-decisioning; however, once creditor has received all six (6) pieces of information, it has an application for purposes of the requirements of Regulation Z Submission may be in written or electronic format and includes a written record of an oral application If creditor is refinancing a covered loan that it already holds or services, applicant must still submit all (6) application items to trigger the disclosure timing

4 v LOAN ESTIMATE & CLOSING DISCLOSURE TIMING Quick Compliance Guide RECEIVE EVENT TIMING COMMENTS APPLICATION ISSUE INITIAL LOAN ESTIMATE AND WRITTEN LIST OF PROVIDERS CAN SHOP FOR Once creditor or mortgage broker receives all (6) items for a covered loan application, the timing for delivering or placing in the mail a Loan Estimate (LE) is triggered Must deliver or place in the mail within three (3) business days from the day the creditor receives the consumer's application Business day means all days institution is substantially open for business Must be delivered or placed in the mail at least seven (7) business days prior to consummation Business day means all calendar days except Sundays and legal public holidays (6) items for application: Name, Social Security number, loan amount, estimated property value, property address, monthly income Submission may be in written or electronic format and includes a written record of an oral application If creditor is refinancing a covered loan that it already holds or services, the applicant must still submit all (6) application items to trigger the disclosure timing Consumer may modify or waive the seven (7) business day waiting period to meet a bona fide personal financial emergency by providing creditor with a dated written statement that describes the emergency, specifically modifies or waives the waiting period, and bears the signature of all the consumers who are primarily liable on the legal obligation Seven (7) business day waiting period only applies to the initial LE Printed forms for waivers are prohibited RECEIPT OF DISCLOSURES IMPOSE OR CHARGE FEES REVISED LOAN ESTIMATE ISSUE CLOSING DISCLOSURE REVISED CLOSING DISCLOSURE RIGHT TO VIEW CD PRIOR TO CONSUMMATION If provided in person, consumer is considered to have received immediately If mailed, including by way of , consumer is considered to have received the disclosures three (3) business days after they are delivered or placed in the mail Business day means all calendar days except Sundays and legal public holidays No charge other than a bona fide and reasonable fee for a credit report may be charged or imposed on the consumer before consumer has received the LE and expressed an intent to proceed with the transaction Must provide within three (3) business days of locking, relocking, or otherwise modifying a rate lock when points, lender credits and any other interest rate dependent charges and terms increase May provide to demonstrate good faith for all other valid changed circumstances provided that the revised LE is provided within three (3) business days of receiving information sufficient to establish the permitted changed circumstance Must provide within three (3) business days of receipt of sufficient information triggering revised LE to re-set baseline for fees Must be received no later than four (4) business days prior to consummation May not be provided on or after the date the Closing Disclosure (CD) is issued Consumer must receive CD at least three (3) business days before consummation Business day means all calendar days except Sundays and legal public holidays Must provide and a new three (3) business day waiting period prior to consummation is triggered if APR or Loan Product inaccurate or a prepayment penalty was added Must provide at or before closing for all other changes Must provide within sixty (60) days of consummation for changes identified within (30) days of consummation o Includes tolerance cures In any event, consumer has right to view CD one (1) business day prior to consummation LE is subject to valid E-Sign (notice, consent and reasonably demonstrate ability to access the information) which must be completed before disclosures are considered delivered or placed in the mail If can evidence disclosures have been received sooner, e.g., creditor s disclosures at 1 p.m. on Tuesday, consumer s creditor with an acknowledgement of receipt of the disclosures at 5 p.m. on the same day; creditor demonstrates that the disclosures were received on the same day Intent to proceed must be documented for all covered loans; intent to proceed only applies to initial LE Prohibited from collecting post-dated checks or credit/debit card information prior to receipt of LE and intent to proceed To demonstrate good faith, may provide within (3) business days of valid changed circumstance but fees may not be re-set unless exceed permitted tolerance Must document all valid changed circumstances, including at a minimum: Original estimate Reason for revision How affected costs Only increased to extent of change Timing requirements met (within 3 business days of triggering event) Business day means all days institution is substantially open for business when providing the revised LE Business day means all calendar days except Sundays and legal public holidays when receiving the revised LE (e.g., no later than (4) business days prior to consummation) Consumer may modify or waive the three (3) business day waiting period to meet a bona fide personal financial emergency by providing creditor with a dated written statement that describes the emergency, specifically modifies or waives the waiting period, and bears the signature of all the consumers who are primarily liable on the legal obligation Printed forms or waivers are prohibited APR is deemed inaccurate, as defined in 12 CFR Loan Product is inaccurate if the type of interest rate (fixed rate, adjustable rate, step rate) or loan feature (negative amortization, interest only, step payment, balloon payment, seasonal payment) changes causing the information to be inaccurate If prepayment penalty is removed, no new waiting period is required; required only if prepayment penalty is added Although a revised CD may be provided at closing, consumer retains right to view CD based on best information reasonably available (1) business day prior to consummation

5 SCHEDULE TILA-RESPA OF FEES INTEGRATED DISC TYPE OF FEE 1 Administrative fees relating to origination, including document copying, delivery, handling and preparation PROVIDED BY LENDER OR BROKER OR AFFILIATE LOAN ESTIMATE 2 CLOSING DISCLOSURE 3 BORROWER CANNOT SHOP FOR 4 BORROWER CAN SHOP FOR PROVIDED BY LENDER OR BROKER OR AFFILIATE BORROWER DID NOT SHOP FOR 5 BORROWER DID SHOP FOR Block A Block A Application Block A Block A Appraisal Block A Block B -- Block A Block B -- Appraisal - Final Construction Appraisal Block A Block B -- Block A Block B -- Closing Agent Block A Block B Block C Block A Block B Block C Construction - Draw Block A Block A Construction - Set-up Block A Block A Courier (lender) Block A Block B Block C Block A Block B Block C Credit Report -- Block B Block B -- Document preparation (loan originator) Block A Block A Escrow Aggregate Adjustment Block G Escrow Initial Deposits -- Block G Block G -- Block G Block G Escrow Waiver Page 4 - Escrow table Flood determination -- Block B Block B -- Flood determination - life of loan -- Block B Block B -- Government Loan Program (any fee paid to a government entity that is paid at consummation, e.g., VA funding fee, USDA guarantee fee) -- Block B Block B -- HOA - Certification -- Block B Block B -- HOA - Dues (paid by seller) Block K/M Block K/M HOA - Prepaids (paid by borrower) -- Block F Block F -- Block F Block F HOA - Initiation -- Block H Block H -- HOA - Processing -- Block H Block H -- Home warranty Block H Block H Inspection - Construction Completion Block A Block B Block C Block A Block B Block C Inspection - Condition -- Block B Block C -- Block B Block C Inspection - Environmental -- Block B Block C -- Block B Block C Inspection - Lender Inspection Block A Block B -- Block A Block B -- Inspection - Pest inspection -- Block B Block C -- Block B Block C Inspection - Presale (electrical, plumbing, radon, structural etc.) -- Block B Block C -- Block B Block C Insurance - Credit life (optional) Block H Block H Insurance - Flood Block F Block F Insurance - Homeowner's Block F Block F Insurance - Mortgage Insurance Premium (MIP) 6 -- Block F Block F -- Insurance - Private Mortgage Insurance (PMI) 6 -- Block F Block F -- Block F Block F Lender Credit(s) 7 Block J Block J Lender s Attorney fee Block A Block B -- Block A Block B -- Loan Administration Block A Block A Loan Commitment Block A Block A Loan Level Price Adjustment (LLPA) 8 Block A Block A Loan Processing Block A Block A MERS registration -- Block B Block B -- Notary (required by lender) Block A Block A Odd Days Interest Block F Block F Origination Block A Block A Pest Inspection (required by lender) -- Block B Block C -- Block B Block C Pest Inspection (optional) Block H Block H

6 SCHEDULE TILA-RESPA OF FEES INTEGRATED DISC Points 9 TYPE OF FEE 1 PROVIDED BY LENDER OR BROKER OR AFFILIATE Block A, first line LOAN ESTIMATE 2 CLOSING DISCLOSURE 3 BORROWER CANNOT SHOP FOR 4 BORROWER CAN SHOP FOR PROVIDED BY LENDER OR BROKER OR AFFILIATE Block A, Line 01 BORROWER DID NOT SHOP FOR 5 BORROWER DID SHOP FOR Property Taxes -- Block F Block F -- Rate Lock Block A Block A Real Estate - Administration fee -- Block H Block H -- Real Estate - Commission -- Block H Block H -- Recording - Assignment of land contract -- Block E Block E -- Recording - Assignment of mortgage -- Block E Block E -- Recording - Assignment of rents and leases -- Block E Block E -- Recording - Manufactured Home filing fee -- Block E Block E -- Recording - Mortgage -- Block E Block E -- Recording - Partial Satisfaction -- Block E Block E -- Recording - Satisfaction -- Block E Block E -- Recording - Subordination -- Block E Block E -- Recording - UCC Filing -- Block E Block E -- Recording - Warranty Deed -- Block E Block E -- Secondary Market - Freddie Mac delivery (charged to borrower) Secondary Market - Loan prospector (charged to borrower) -- Block B Block B Block B Block B -- Secondary Market - Rate Lock charged to borrower -- Block A Block A -- Seller Credits Calculating Cash to Close table Calculating Cash to Close table and Block L Subordination (payable to third party, not a government entity) -- Block B Block B -- Survey -- Block B Block C -- Block B Block C Taxes - Status Research Service -- Block B Block B -- Taxes - Tax Monitoring -- Block B Block B -- Taxes - Transfer tax -- Block E Block E -- Title - Abstract -- Block B Block C -- Block B Block C Title - Administrative fees relating to title services, including document copying, delivery, handling, and preparation -- Block B Block C -- Block B Block C Title - Agent portion -- Block B Block C -- Block B Block C Title - Closing Protection Letter -- Block B Block C -- Block B Block C Title - Commitment -- Block B Block C -- Block B Block C Title - Courier -- Block B Block C -- Block B Block C Title - Examination -- Block B Block C -- Block B Block C Title - Insurance Binder -- Block B Block C -- Block B Block C Title - Lender's title and endorsements -- Block B Block C -- Block B Block C Title - Owner's title insurance (required by lender) -- Block B Block C -- Block B Block C Title - Owner s title insurance (optional) -- Block H Block H -- Block H Block H Title - Search -- Block B Block C -- Block B Block C Title - Settlement agent -- Block B Block C -- Block B Block C Title - Underwriter portion -- Block B Block C -- Block B Block C Tolerance Cures (complete as Lender Credits) Block J Block J Underwriting Block A Block A VOE/VOD Block A Block B -- Block A Block B -- Wire Block A Block B Block C Block A Block B Block C

7 SCHEDULE TILA-RESPA OF FEES INTEGRATED DISC SCHEDULE OF FEES NOTES 1. When completing the Loan Estimate (LE) and the Closing Disclosure (CD): All fees/charges must be listed alphabetically within each respective Block Hard-coded fee/charge labels on the standard model forms are not to be deleted, even if fee/charge does not apply; leave such fields blank if do not apply For example, if there are no points paid to buy the interest rate, the % Loan Amount (Points) label is still listed in Block A on LE/CD and the amounts (% and $) are left blank May not use N/A Only enter 0 (zero) if expressly provided for in regulation All title fees must begin with Title - followed by the sub-category of title service Optional fees must include the statement (optional) next to the fee name Fee nomenclature should be consistent between the LE and the CD to avoid any confusion to the consumer 2. Generally, the Loan Estimate must reflect the estimated costs and terms of the transaction based on the best information reasonably available at the time of the disclosure. In any event, the creditor or mortgage broker must act in good faith when providing estimates on the LE. Don t ask, don t tell is not an option Additionally, no fee, other than a reasonable fee for a credit report, may be charged or imposed until the borrower receives the LE and communicates an intent to proceed Prohibited from collecting post-dated checks and the collection of credit/debit card information 3. Generally, the Closing disclosure must reflect the actual costs and terms of the transaction. If a fee is unknown at the time of consummation, must use the term estimated If a fee is to be paid outside of closing after consummation, must use POC or paid outside of closing with the amount or, if applicable, estimated amount 4. Services You Cannot Shop For on the LE include settlement services for which the borrower is permitted to shop but may only select from a limited list provided by the creditor or mortgage broker (as applicable) 5. Services Borrower Did Not Shop for on the CD include settlement services for which the borrower was permitted to shop but selected from the Written List of Providers as well as services for which the borrower did not shop and thus, the creditor/mortgage broker selected 6. Lender Credits may be designated in the Closing Costs Details on Page 2 of the CD if the lender is paying for a particular settlement service on behalf of the borrower. The lender has the option to indicate that it was paid by the lender by including (L) next to the amount. If the lender is providing a lump sum credit to the borrower, the lender credit is entered into Block J under Lender Credits. 7. Upfront mortgage insurance premiums are included in Block B - Services You Cannot Shop For if the fee is charged at consummation and is not a prepayment of future premiums over a specific future time period or a payment into an escrow account 8. A charge imposed to pay for a loan level price adjustment (LLPA) assessed on the creditor, which the creditor passes on to the consumer as a charge at consummation and not as an adjustment to the interest rate, must be separately itemized 9. Points are amounts charged in connection with the transaction to reduce the interest rate The label % Loan Amount (Points) must always appear as the first charge in Block A on both LE and CD If there are no points charged in connection with the transaction to reduce the interest rate, the creditor leaves blank the percentage of points used in the label and the dollar amount 10. Recording fees are aggregated and listed as one amount on the LE under Block E - Recording fees. Transfer taxes are also aggregated and listed as one amount under Block E - Transfer taxes

8 SCHEDULE TILA-RESPA OF FEES INTEGRATED DISC BLOCK GENERAL DESCRIPTION LOAN ESTIMATE Block A = Origination Charges Charges paid by the consumer to each creditor and loan originator for originating and extending the credit, regardless of how such fees are denominated Block B = Services Borrower Cannot Shop Services that the creditor requires in connection with the transaction that would be provided by For persons other than the creditor or mortgage broker and for which the creditor does not permit the consumer to shop; a consumer is not permitted to shop if the consumer must choose a provider from a list provided by the creditor Block C = Services Borrower Can Shop For Services that: The creditor requires in connection with its decision to make the loan; Would be provided by persons other than the creditor or mortgage broker; and For which the creditor allows the consumer to shop Block E = Taxes and Other Government Fees The amounts to be paid to State and local governments for taxes and other government fees, where the first line reflects an aggregate of all recording and government fees and the second line reflects any transfer taxes Block F = Prepaids The itemization of the amounts to be paid by the consumer in advance of the first scheduled payment Block G = Initial Escrow Payment at Closing The amounts that the consumer will be expected to place into a reserve or escrow account at consummation to be applied to recurring periodic charges Block H = Other Any other amounts in connection with the transaction that the consumer is likely to pay or has contracted with a person other than the creditor or loan originator to pay at closing and of which the creditor is aware at the time of issuing the Loan Estimate and a descriptive label of each such amount Block J = Total Closing Costs The sum of Block D (A+B+C) + Block I (E+F+G+H), less any Lender Credits CLOSING DISCLOSURE Block A = Origination Charges Charges paid by the consumer to each creditor and loan originator for originating and extending the credit, regardless of how such fees are denominated, the amount of compensation paid by the creditor to a third-party loan originator along with the name of the loan originator ultimately receiving the payment Block B = Services Borrower Did Not Shop For Services and corresponding costs for each of the settlement services required by the creditor for which the consumer did not shop and that are provided by persons other than the creditor or mortgage broker along with the name of the person ultimately receiving the payment for each such amount Includes services contained on lender s Written List of Providers that the consumer selected Block C = Services Borrower Did Shop For Services and corresponding costs for each of the settlement services required by the creditor for which the consumer did shop and that are provided by persons other than the creditor or mortgage broker along with the name of the person ultimately receiving the payment for each such amount Consumer did not select from Written List of Providers Block E = Taxes and Other Government Fees An itemization of each amount that is expected to be paid to State and local governments for taxes and government fees Block F = Prepaids The itemization of the amounts to be paid by the consumer in advance of the first scheduled payment Block G = Initial Escrow Payment at Closing The amounts that the consumer will be expected to place into a reserve or escrow account at consummation to be applied to recurring periodic charges, including the RESPA escrow aggregate adjustment (as applicable) Block H = Other Any other amounts in connection with the transaction for services that are required or obtained in the real estate closing by the consumer, the seller, or other party and the name of the person ultimately receiving the payment Block J = Total Closing Costs The sum of Block D (A+B+C) + Block I (E+F+G+H), less any Lender Credits Block K = Due from Borrower at Closing Itemization of the borrower s side of the transaction to indicate amounts due and/or payable Block L = Paid Already by or on Behalf of Itemization of amounts paid by or on behalf of the borrower Borrower at Closing Block M = Due to Seller at Closing Itemization of the seller s side of the transaction to indicate amount due and/or payable

9 GOOD FAITH AND TILA-RESPA REVISED LOAN ESTIMATES INTEGRATED DISC GOOD FAITH AND REVISED LOAN ESTIMATES To demonstrate good faith, the closing costs paid by or imposed on the consumer may not exceed the amount originally disclosed on the Loan Estimate (LE), unless it meets an exception A charge paid by or imposed on the consumer refers to the final amount for the charge paid by or imposed on the consumer at consummation or settlement, whichever is later A fee is not considered paid to a person if the person does not retain the fee Exceptions: 10% increase permitted for certain third-party charges. A third-party service fee or a recording fee may be estimated and will be considered in good faith if: The aggregate amount of charges for third-party services and recording fees ultimately paid by or imposed on the consumer does not exceed the aggregate amount of such charges disclosed on the LE by more than 10%; The third-party service charge is not paid to the creditor or its affiliate; and The consumer is permitted to shop for the third-party service No limitations on increases for certain charges. The following charges may be estimated and will be considered in good faith if they are consistent with the best information reasonably available to the creditor at the time the estimate is provided, regardless of the amount actually paid: Prepaid interest; Property insurance premiums; Amounts placed into an escrow, impound, reserve, or similar account; Charges paid to third-party service providers selected by the consumer that are not on the creditor s list of service providers; and Charges paid for third-party services not required by the creditor, even if paid to an affiliate of the creditor. Exceptions for revisions to estimates Unless a revision is permitted for one of the stated reasons, increases are not allowed for other estimated charges, such as creditor and loan originator charges and charges paid to an affiliate of the creditor For unaffiliated third-party charges subject to the 10% limitation, the aggregate amount of such charges cannot increase by more than 10% unless an exception applies A creditor may increase an estimated charge beyond the limitations discussed above if the increase is due to any of the following reasons: Changed circumstances affecting eligibility or settlement charges. One of the following changed circumstances affects the consumer s creditworthiness or the value of the security or causes the estimated charge to increase: An extraordinary event beyond the control of any interested party or other unexpected event specific to the consumer or transaction; Information specific to the consumer or transaction that the creditor relied upon when providing the LE and that was inaccurate or changed after the disclosures were provided; or New information specific to the consumer or transaction that the creditor did not rely on when providing the original LE Consumer request. The consumer requests revisions to the credit terms or the settlement that cause an estimated charge to increase Interest rate dependent charge Discount points, loan originator charges, and loan originator credits change because the interest rate was not locked when the LE was provided Expiration of intent to proceed If consumer does not indicate an intent to proceed within ten (10) business days after the LE was provided, revised LE may be provided Delayed Settlement on New Construction Loans If creditor reasonably expects that settlement will occur more than sixty (60) days after initial LE is provided, creditor may provide a revised LE, but only if original LE states clearly and conspicuously that at any time prior to 60-days before consummation, creditor may issue revised disclosures Note: If an estimate is revised for one of the above reasons, creditor must provide a revised LE within three (3) business days of receiving information sufficient to establish that the reason applies; however, creditor must not provide a revised LE on or after the date it provides the Closing Disclosure. Consumer must receive the revised LE not later than four (4) business days prior to consummation. For unaffiliated third-party charges subject to the 10% limitation, it appears that the final rule permits the creditor to provide a revised LE when such charges increase by less than 10%, regardless of whether this increase is due to a changed circumstance or other exception; however, unless these charges increase in the aggregate by more than 10% due to a changed circumstance or other exception, the revised LE does not re-set the 10% tolerance and the final charges will be measured against those disclosed on the original LE or on the last revised LE that was based on a changed circumstance or other exception. Good faith analysis for lender credits For purposes of conducting the good faith analysis for lender credits, the total amount of lender credits, whether specific or non-specific, actually provided to the consumer is compared to the amount of the lender credits in Block J on the LE The total amount of lender credits actually provided to the consumer is determined by aggregating the amount of the lender credits in Block J on the CD with the amounts paid by the creditor that are attributable to a specific loan cost or other cost, disclosed in Blocks A, B, C, E, F, G, and/or H (as applicable) on the CD

10 CALCULATING THE TOTAL INTEREST PERCENTAGE (TIP) Quick Compliance Guide TOTAL INTEREST PERCENTAGE (TIP) Definition: The TIP is the total amount of interest that the consumer will pay over the loan term, expressed as a percentage of the loan amount Do not include Points paid in TIP calculation(based on CFPB s calculated amounts) Be sure to use your actual accrual basis Example: If the Loan Amount is $100,000 and the total amount of interest that the consumer will pay over the Loan Term is $50,000, then the TIP is 50% ($50,000/$100,000) EXAMPLE Loan Amount $162, Term of loan in months Monthly Payment Total P&I payments (Monthly Payment * 360)= Total amount of interest from amortization schedule based on 360/365 accrual basis= Plus Pre-paid Interest paid at closing (from Closing Disclosure Other Costs, Block F Prepaids, Line 03)= Total Interest Paid (Sum of Total Interest from amort schedule plus prepaid interest)= Total Interest Paid / Loan Amount * 1 (rounded to 2 decimals) as a percentage (TIP) 360 $ $274, $112, $ $112, %

11 LOAN ESTIMATE TILA-RESPA ADDENDA INTEGRATED DISC TRID regulatory requirements for adding additional pages (addenda) to the Loan Estimate (LE) and Closing Disclosure (CD) forms are quite restrictive Rules expressly provide for when an addendum may be added or attached to the end of the respective form Permitted addenda pages may not be placed in between pages of the standard form pages of the LE or CD Only the permitted LE or CD addenda may be combined with the LE or CD; all other disclosures, including the Written List of Providers (can or cannot shop for) and state law disclosures, must be physically separate from the LE and CD Information must be consolidated on as few pages as necessary to not affect the substance, clarity, or meaningful sequence of the LE/CD disclosures Formatting and headings must follow the applicable LE or CD form and section LOAN ESTIMATE FORM SECTION ADDENDA PERMITTED FOR ADDENDA SPECIFICALLY NOT PERMITTED FOR APPLICANTS PROPERTY (REAL PROPERTY) PROPERTY (PERSONAL PROPERTY) BLOCK A ORIGINATION CHARGES BLOCK B SERVICES YOU CANNOT SHOP FOR BLOCK C SERVICES YOU CAN SHOP FOR BLOCK E TAXES AND OTHER GOVERNMENT FEES BLOCK F PREPAIDS BLOCK G INITIAL ESCROW PAYMENT AT CLOSING BLOCK H OTHER CONFIRM RECEIPT (SIGNATURE LINE) ADDITIONAL INFORMATION ABOUT THIS LOAN LENDER AND MORTGAGE BROKER CONTACT INFORMATION CUSTOMARY RECITALS AND INFORMATION Listing the name and address of all applicants Listing all real properties, including zip code when multiple properties are used to secure the loan None None If consumer is permitted to shop for a settlement service, must provide a written list identifying at least one provider and statement that consumer may choose a different provider for that service Must be provided separately from the LE Model form H-27(A) Written List of Providers available; no regulatory requirement to include an estimate for the listed provider None None Listing all Co-applicants provided heading Confirm Receipt and entire disclosure statement on LE regarding acknowledgement of receipt is included May expand current space to include additional creditors and/or mortgage brokers, including contact information, provided all other sections on LE Page 3 continue to appear on same page; otherwise, must use additional page Additional page may be added for customary recitals and information used locally in real estate settlements Examples: breakdown of payoff figures, breakdown of consumer's total monthly mortgage payments, an accounting of debits received and check disbursements, a statement stating receipt of funds, applicable special stipulations between consumer and seller, and date funds are transferred Personal property securing the loan may be disclosed if fits in allocated space on the LE form If items exceed permitted (13) maximum in each Block, use last line available, aggregate amount of remaining fees, and title the line Additional Charges State law disclosures must be provided on a separate document and not part of the LE If items exceed permitted (14) maximum, you may either use last line available to state: Additional Charges and include the aggregate amount of such remaining fees; or See attached page for additional items you can shop for and attach Model form H-27(A) with the applicable information and estimates Aggregate all recording fees and other government fees and taxes, except for transfer taxes paid by the consumer, under Recording Fees and Other Taxes Aggregate all transfer taxes under Transfer Taxes If items exceed permitted maximums, use last line available, aggregate amount of remaining fees, and title the line Additional Charges Maximum for Block F = (13); G = (13); H = (14) State law disclosures must be provided on a separate document and not part of the LE, and must be physically separate from LE

12 v CLOSING DISCLOSURE TILA-RESPA ADDENDA INTEGRATED DISC TRID regulatory requirements for adding additional pages (addenda) to the Loan Estimate (LE) and Closing Disclosure (CD) forms are quite restrictive Rules expressly provide for when an addendum may be added or attached to the end of the respective form Permitted addenda pages may not be placed in between pages of the standard form pages of the LE or CD Only the permitted LE or CD addenda may be combined with the LE or CD; all other disclosures, including the Written List of Providers (can or cannot shop for) and state law disclosures, must be physically separate from the LE and CD Information must be consolidated on as few pages as necessary to not affect the substance, clarity, or meaningful sequence of the LE/CD disclosures Formatting and headings must follow the applicable LE or CD form and section PROPERTY (REAL PROPERTY) CLOSING DISCLOSURE FORM SECTION ADDENDA PERMITTED FOR ADDENDA NOT PERMITTED FOR PROPERTY (PERSONAL PROPERTY) TRANSACTION INFORMATION BORROWER SELLER Listing all real properties, including zip code when multiple properties are used to secure the loan Optional to include list of all personal property securing the loan (unlike LE) Limited to no more than one page in combination with Security Interest for personal property Listing the name and address of all applicants and/or sellers, as applicable TRANSACTION INFORMATION LENDER BLOCK K DUE FROM BORROWER AT CLOSING BLOCK L - TOTAL PAID ALREADY BY OR ON BEHALF OF BORROWER AT CLOSING None Additional pages to accommodate the complete listing of all items required to be shown under Borrower s Transaction Only one creditor shall be disclosed If transaction involves more than one creditor, only one set of disclosures shall be given and creditors must agree among themselves which creditor must comply with the requirements imposed on any or all of them BLOCK M DUE TO SELLER AT CLOSING BLOCK N DUE FROM SELLER AT CLOSING SECURITY INTEREST (PERSONAL PROPERTY) CONFIRM RECEIPT (SIGNATURE LINE) ADDITIONAL INFORMATION ABOUT THIS LOAN LENDER AND MORTGAGE BROKER CONTACT INFORMATION CUSTOMARY RECITALS AND INFORMATION Additional pages to accommodate the complete listing of all items required to be shown under Seller s Transaction Optional to include list of all personal property securing the loan Limited to no more than one page in combination with Property for personal property Listing all Co-applicants provided heading Confirm Receipt and entire disclosure statement on CD regarding acknowledgement of receipt is included May expand current space to include additional creditors and/or mortgage brokers, including contact information, provided all other sections continue to appear on same page; otherwise, must use additional page Additional page may be added for customary recitals and information used locally in real estate settlements

13 HEADING INFORMATION FIELD NAME LE CD NUMBER TYPE TILA-RESPA INTEGRATED DISC LOAN ESTIMATE AND CLOSIND DISCLOSURE ROUNDING ROUNDING RULE(S) & TRUNCATION 1 Product X X # If 24 months or more, round to two decimal places when not in whole years (e.g. 2.5/1 Adjustable Rate) If less than 24 months, use whole months with mo. LOAN TERMS Loan Amount X X $ Do not round Two decimal places; truncate whole numbers at decimal point Interest Rate X X % Disclose up to two or three decimal places; truncate whole numbers at decimal point Monthly Principal & Interest X X $ Two decimal places; truncate whole numbers at decimal point NOTE: Separate requirements may apply for the maximum amounts disclosed in response to whether or not the amount can increase after closing If the principal and interest payment or loan amount can increase after closing, the maximum amounts required to be disclosed should be rounded to the nearest whole dollar If the interest rate can increase after closing, the same rounding rules will apply for stating the initial rate as well as the maximum amounts required to be disclosed Prepayment Penalty X X $ Round to the nearest whole dollar Balloon Payment X X $ Round to the nearest whole dollar PROJECTED PAYMENTS Principal & Interest X X $ Two decimal places. If additional columns, two decimal places. If range, round to the nearest whole dollar Mortgage Insurance X $ Round to the nearest whole dollar. If additional columns, round to the nearest whole dollar Mortgage Insurance X $ Two decimal places. If additional columns, two decimal places. If range, round to the nearest whole dollar Estimated Escrow X $ Round to the nearest whole dollar. If additional columns, round to the nearest whole dollar Estimated Escrow X $ Two decimal places. If additional columns, two decimal places. If range, round to the nearest whole dollar Estimated Total Monthly Payment X $ Round to the nearest whole dollar Estimated Total Monthly Payment X $ Two decimal places Estimated Taxes, Insurance and Assessments Estimate Taxes, Insurance and Assessments COSTS AT CLOSING / ALTERNATE COSTS AT CLOSING X $ Round to the nearest whole dollar X $ Two decimal places Estimated Closing Costs (all) X $ Round to the nearest whole dollar Closing Costs (all) X $ Two decimal places Estimated Cash to Close X $ Round to the nearest whole dollar Cash to Close X $ Two decimal places LOAN COSTS Origination Charges (all) X $ Round to the nearest whole dollar Origination Charges (all) X $ Two decimal places - % of Loan Amount (points) X X % Disclose up to two decimal places; truncate whole numbers at decimal point Services You Cannot Shop For X $ Round to the nearest whole dollar Services Borrower Did Not Shop For X $ Two decimal places Services You Can Shop For X $ Round to the nearest whole dollar Services Borrower Did Shop For X $ Two decimal places Total Loan Costs X $ Round to the nearest whole dollar Total Loan Costs X X $ Two decimal places OTHER COSTS Taxes and Other Government Fees (all) X $ Round to the nearest whole dollar Taxes and Other Government Fees (all) X $ Two decimal places Prepaids X $ Round to the nearest whole dollar

14 FIELD NAME LE CD NUMBER Prepaid interest ($xx.xx) per day for (x) **(x%) X X X - Homeowner s Insurance X $ Round to the nearest whole dollar - Mortgage Insurance X $ Round to the nearest whole dollar - Property Taxes X $ Round to the nearest whole dollar TYPE - Homeowner s Insurance X $ Two decimal places - Mortgage Insurance X $ Two decimal places - Property Taxes X $ Two decimal places Initial Escrow Payment at Closing X $ Round to the nearest whole dollar Initial Escrow Payment at Closing X $ Two decimal places X X TILA-RESPA INTEGRATED DISC LOAN ESTIMATE AND CLOSIND DISCLOSURE ROUNDING ROUNDING RULE(S) & TRUNCATION 1 Do not round per day interest; reflect up to two decimal places Whole days Disclose interest rate up to two or three decimal places; truncate whole numbers at decimal point - Homeowner s Insurance X $ Two decimal places for per month; round to nearest whole dollar for subtotal - Mortgage Insurance X $ Two decimal places for per month; round to nearest whole dollar for subtotal - Property Taxes X $ Two decimal places for per month; round to nearest whole dollar for subtotal - Homeowner s Insurance X $ Two decimal places - Mortgage Insurance X $ Two decimal places - Property Taxes X $ Two decimal places - Aggregate Adjustment X $ Two decimal places Other (all) X $ Round to the nearest whole dollar Other (all) X $ Two decimal places Total Other Costs (all) X $ Round to the nearest whole dollar Total Other Costs (all) X Two decimal places Total Closing Costs (all) X $ Round to the nearest whole dollar Total Closing Costs (all) X $ Two decimal places CALCULATING CASH TO CLOSE X $ Round to the nearest whole dollar CALCULATING CASH TO CLOSE X $ Two decimal places ADJUSTABLE PAYMENT (AP) TABLE X X $ Round to the nearest whole dollar ADJUSTABLE INTEREST RATE (AIR) TABLE X X % Disclose up to two or three decimal places; truncate whole numbers at decimal point SUMMARIES OF TRANSACTIONS (ALL) X $ Two decimal places AMOUNT (PAYOFFS AND PAYMENTS ALTERNATE TABLE) (ALL) COMPARISONS X $ Two decimal places In 5 Years (Total & Principal only) X $ Round to the nearest whole dollar Annual Percentage Rate (APR) X % Must round to three decimal places unless whole number; truncate whole numbers at decimal point Total Interest Percentage (TIP) X % Disclose up to two or three decimal places; truncate whole numbers at decimal point LOAN CALCULATIONS Total of Payments X $ Two decimal places Finance Charge X $ Two decimal places Amount Financed X $ Two decimal places Annual Percentage Rate (APR) X % Must round to three decimal places unless whole number; truncate whole numbers at decimal point Total Interest Percentage (TIP) X % Disclose up to two or three decimal places; truncate whole numbers at decimal point OTHER CONSIDERATIONS Late Payment X X % Two decimal places; truncate whole number at decimal point Escrow Account (table) X $ Two decimal places No Escrow X $ Two decimal places 1 Two decimal places without a truncation rule indicates that amounts must include two decimal places for.00. For example, if appraisal fee is $425, on the CD, the amount must be listed as $425.00, not $425.