The Consumer Financial Protection Bureau (“CFPB”) issued a new interpretive rule (the “Rule”) in light of the current COVID-19 pandemic which addresses a creditors use of revised loan estimates due to “changed circumstances”.
Under the TILA-RESPA Integrated Disclosure rule (“TRID”), creditors are required to estimate, in good faith, the costs that a consumer will incur in their mortgage transaction. The estimate is reported on the loan estimate which must be provided to the consumer no later than three days before consummation of the transaction. However, in light of the current COVID-19 pandemic, the CFPB acknowledges that a creditors ability to provide an accurate estimate of the charges may be impacted.
TRID accommodates the use of revised loan estimates in a limited number of situations, including if there are “changed circumstances.” As defined, “changed circumstances” are extraordinary events beyond the control of any interested party. The Rule concludes that the COVID-19 pandemic qualifies as a “changed circumstance” allowing lenders to use revised loan estimates.