Source: https://info.idsdoc.com/Compliance/November
Timestamp: 2019-04-23 19:10:04+00:00

Document:
From the perspective of a vendor, IDS recognizes the importance of vendors to implementation of the TILA-RESPA Integrated Disclosures. It cannot be overstated just how important vendors, in general, will be to the TRID puzzle. Vendors can help manage many aspects of the rule, including: data collection, data and file transfer, document generation, fulfillment and eSign, data storage, timing requirement audits and alerts, and more. In the loan origination process, there are many vendors that may play a part in producing and completing the LE & CD, e.g., brokers, LOS providers, document preparation providers, compliance review providers, and settlement service providers. Given the importance of vendors in assisting with TRID, there is no doubt that creditors will rely on the expertise of vendors to do a particular function; however, the rule gives creditors good reason to pay close attention to their vendor management, especially in the case of brokers and settlement service providers, as seen from the citations to the rule in the next two paragraphs.
§ 1026.19(e)(1)(ii) provides that a mortgage broker may provide the LE on behalf of the creditor; however, the rule states that “the creditor shall ensure that such disclosures are provided in accordance with all requirements of [ the rule for LE disclosure].” This verbiage squarely places responsibility for compliance with requirements for the LE upon the shoulders of the creditor even when a broker is providing it on the creditor’s behalf. The comment to this section details this responsibility even further by stating “that the creditor must ensure that [LE] disclosures provided by mortgage brokers comply with all requirements of [LE disclosure], and that [LE] disclosures provided by mortgage brokers that do comply with all such requirements satisfy the creditor’s obligation [for LE disclosure]—the logical inference is that if the creditor does NOT ensure that the disclosures provided by mortgage brokers do comply with all such requirements then the creditor’s obligation is NOT satisfied and the creditor is liable for any LE disclosure errors made by the broker.
TRID has several required provisions for “curing” inaccuracies or changes due to events occurring after consummation in the Closing Disclosure given to the Borrower and/or Seller.
§ 1026.19(f)(2)(iii), has answers to changes due to events occurring after consummation that affect the amount paid by the borrower. The rule states that if an event in connection with the settlement of the transaction occurs within the first 30 days that makes the amount actually paid by the consumer inaccurate in comparison to the CD, then the creditor must place in the mail corrected disclosures within 30 days of knowing that the inaccuracy occurred (paraphrased). § 1026.19(f)(4)(i) & (ii) has a similar requirement for when the CD specific to when the seller becomes inaccurate with regards to amounts actually paid by the seller. This is what IDS Compliance calls the “30 day + 30 day” correction rule because there are 30 days to find out about it and 30 days to correct it.
§ 1026.19(f)(2)(iv) has answers as to what to do when there are non-numeric clerical errors. In general, creditors have 60 days to mail corrected disclosures with errors of this type. Be careful, though, because “non-numeric clerical errors” are defined more narrowly as not only items that affect a numeric calculation, but items that affect requirements imposed by § 1026.19(e) or (f). Apparently, the operative word is “clerical” and an analysis of a violation of this type needs to include whether or not the violation is “clerical.” The commentary uses an example of an inaccuracy in the name of the service provider as being “non-numeric,” and juxtaposes that against the disclosure containing the wrong property address, which, although non-numeric in nature, goes directly to the heart of the “requirements imposed by § 1026.19(e) or (f)” and, therefore, more than just a “clerical” error. A non-numeric error, dropping the “clerical” part, would be a more serious violation but the rule does not give an example of what to do should your analysis of the type of violation committed result in being more than just a “clerical” error. This is what IDS Compliance calls the “60 day” rule because creditors have just the 60 day timeframe to both find out about it and send the corrected disclosures.
§ 1026.19(f)(2)(v) has answers as to what to do when refunds are needed related to the good faith analysis. If a consumer pays amounts that exceed the good faith determination for estimates of closing costs. See, 19(e)(2), the creditor does not violate the rule if the creditor refunds the excess amount paid back to the borrower no later than 60 days after consummation. The creditor must also redisclose in the same 60 day time frame. This is what IDS Compliance calls the “60 day/60 day” rule because creditors have 60 days to refund and a simultaneous 60 days to send corrected disclosures.
IDS Compliance will present a series of webinars related to the TILA-RESPA Integrated Disclosure rule. The first webinar, scheduled for Tuesday, November 18, 2014, will be an overview of the IDS Implementation Plan and a preview of some of the changes coming the idsDoc System. The second webinar, scheduled for Tuesday, March 17, 2015, will address more of the idsDoc System changes in greater detail. The third webinar, scheduled for Tuesday, June 30, 2015, will cover best practices for testing the TRID Forms and integration with other systems.
IDS Customers who are unable to attend any of the scheduled sessions for any reason will be able to view a recorded version of the webinars the next day on the Compliance Resources page.
Most lenders already recognize the importance of managing record retention policies; however, little, yet important, things like making sure that IT has the infrastructure to manage longer retention periods will be an important part of the TRID implementation process.
A creditor shall retain evidence of compliance with the requirements of [the Loan Estimate (and the CD when the loan does not consummate)] for three years after the later of the date of consummation, the date disclosures are required to be made, or the date the action is required to be taken.
A creditor shall retain each completed disclosure required [for Closing Disclosures] and all documents related to such disclosures, for five years after consummation, notwithstanding [selling, transferring, or otherwise disposing of its interest in the loan].
The 5-year retention requirement, which is “all documents related to [the CD]” is invoked at consummation. This “all documents related to [the CD]” verbiage means that it is likely that a copy of the LE will need to be retained with the CD for 5 years from the moment of consummation.

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