Before consummation of a regular transaction subject to TRID, a change to an APR-included charge raises the actual APR from the 6.412% disclosed on the Closing Disclosure to 6.545%. No separate APR-accuracy exception or valid waiting-period waiver applies. What must the creditor do?
Correct Answer
A) Provide a corrected Closing Disclosure received at least three business days before consummation
A. Correct the disclosure and satisfy a new three-business-day waiting period. The difference is 0.133 percentage point, exceeding the ordinary 0.125-point regular-transaction tolerance. An inaccurate APR is a specified trigger for a new waiting period; mere preparation or dispatch of the correction is not receipt. Scope and exceptions: Assess all APR-accuracy provisions before finding a real loan inaccurate. The assumed regular classification, not a fixed-rate label alone, determines the ordinary tolerance. Other changes may require correction without a new waiting period. Source: Section 1026.22(a)(2)–(5) — https://www.consumerfinance.gov/rules-policy/regulations/1026/22/ Section 1026.19(f)(2)(ii)(A) and comment 19(f)(2)(ii)-1 — https://www.consumerfinance.gov/rules-policy/regulations/1026/19/
Why This Is the Correct Answer
A. Correct the disclosure and satisfy a new three-business-day waiting period. The difference is 0.133 percentage point, exceeding the ordinary 0.125-point regular-transaction tolerance. An inaccurate APR is a specified trigger for a new waiting period; mere preparation or dispatch of the correction is not receipt. Scope and exceptions: Assess all APR-accuracy provisions before finding a real loan inaccurate. The assumed regular classification, not a fixed-rate label alone, determines the ordinary tolerance. Other changes may require correction without a new waiting period.
Why the Other Options Are Wrong
Option B: Redisclose with no new waiting period, as only the loan product restarts it
An inaccurate APR also triggers the wait.
Option C: No redisclosure: an APR difference under 0.25 is accurate on any loan
The 0.25-point rule is not universal.
Option D: Redisclose and restart 7 days, which is the period for an APR change
Seven days is not this correction's waiting period.
Exam Tip
First test APR accuracy; then determine the required correction timing.
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