ABA Supports CFPB’s Proposed Fix to TRID’s ‘Black Hole’ Problem

ABA today commented on proposed changes to the TILA-RESPA integrated disclosures that would allow creditors to use either initial or corrected closing disclosures to reflect changes in costs for purposes of determining if an estimated closing cost was disclosed in good faith, regardless of when the closing disclosure was provided relative to consummation. The proposal is aimed at correcting the “black hole” problem identified by ABA in previous comments, in which consumers are subject to forced regulatory closing delays because of legitimate fee changes in the origination process.

In a comment letter to the Consumer Financial Protection Bureau, ABA expressed support for the CFPB’s removal of the four-business day limit for resetting tolerances that exist in current law. “ABA believes that the use of [closing disclosures], whether initial or corrected, as a vehicle for correcting and ‘re-baselining’ fee disclosures, is a straightforward approach to returning regulatory order and compliance clarity on this provision,” the association said.

ABA has long called on the CFPB to take action on the “black hole” problem and has engaged deeply with member bankers and the bureau on this issue. The association requested additional TRID clarifications, such as the application of the rule in instances concerning fee variations due to interest rate changes, and the timing allowed for the delivery of the corrected closing disclosure. For more information, contact ABA’s Rod Alba.


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