A settlement agent wants to provide the seller a separate Closing Disclosure rather than disclose the buyer's $61,000 cash to close and loan terms on the seller's document. Is a separate seller disclosure permitted by Regulation Z?
Correct Answer
D) Yes: a separate seller disclosure may omit specified buyer information while reporting the seller's actual transaction
D. Separate seller disclosures are permitted with the prescribed information and omissions. Regulation Z permits separating the buyer and seller information. The seller still receives the actual terms applicable to the seller's transaction. Scope and exceptions: Provide the seller disclosure no later than the day of consummation. When separate documents are used, the creditor receives a copy of the seller disclosure if it is not itself the settlement agent. This permission is not a universal privacy prohibition or a mandate to separate every form. Source: Section 1026.19(f)(4)(i), (ii), (iv) — https://www.consumerfinance.gov/rules-policy/regulations/1026/19/ Section 1026.38(t)(5)(v); comments 38(t)(5)-2 and -3 — https://www.consumerfinance.gov/rules-policy/regulations/1026/38/
Why This Is the Correct Answer
D. Separate seller disclosures are permitted with the prescribed information and omissions. Regulation Z permits separating the buyer and seller information. The seller still receives the actual terms applicable to the seller's transaction. Scope and exceptions: Provide the seller disclosure no later than the day of consummation. When separate documents are used, the creditor receives a copy of the seller disclosure if it is not itself the settlement agent. This permission is not a universal privacy prohibition or a mandate to separate every form.
Why the Other Options Are Wrong
Option A: No: the seller must receive every detail of the buyer's loan terms
The rule permits specified buyer information to be omitted.
Option B: No: both parties must always receive and sign one shared Closing Disclosure
One shared, jointly signed document is not required by this provision.
Option C: Yes: but then the seller receives no disclosure of the seller's costs or proceeds
Separating forms does not remove seller disclosure duties.
Exam Tip
Separate presentation does not mean incomplete seller disclosure.
More Origination Questions
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