For a TRID-covered loan, the applicable Loan Estimate shows a creditor-retained origination fee of $1,200 and a required appraisal fee of $650 for which shopping is not permitted. The consumer pays $1,275 and $650 respectively at consummation. No valid basis for revised estimates applies. What tolerance cure is required?
Correct Answer
D) Refund $75 for the origination-fee excess and provide corrected disclosures
D. Refund the $75 excess and provide corrected disclosures. The creditor-retained origination fee is subject to the no-increase standard on these facts: $1,275 − $1,200 = $75. The unchanged appraisal creates no additional excess. Combining the fees into a 10% aggregate does not excuse this increase. Scope and exceptions: Under the specified post-consummation cure, refund and corrected disclosures are due no later than 60 days after consummation. Valid revised-estimate grounds and timing must be assessed separately; absence of a changed circumstance alone does not exclude every possible revision ground. Source: Section 1026.19(e)(3)(i)–(iv) and (f)(2)(v) — https://www.consumerfinance.gov/rules-policy/regulations/1026/19/
Why This Is the Correct Answer
D. Refund the $75 excess and provide corrected disclosures. The creditor-retained origination fee is subject to the no-increase standard on these facts: $1,275 − $1,200 = $75. The unchanged appraisal creates no additional excess. Combining the fees into a 10% aggregate does not excuse this increase. Scope and exceptions: Under the specified post-consummation cure, refund and corrected disclosures are due no later than 60 days after consummation. Valid revised-estimate grounds and timing must be assessed separately; absence of a changed circumstance alone does not exclude every possible revision ground.
Why the Other Options Are Wrong
Option A: No cure is owed, since the appraisal was unchanged from the estimate
An unchanged appraisal does not cure a separate fee increase.
Option B: No cure is owed, because the total of the two charges rose under 10%
The 10% category does not apply to this origination charge.
Option C: A cure of $75 is owed only if the aggregate rises more than 10%
The $75 refund is not conditional on crossing a 10% aggregate.
Exam Tip
Identify the fee category before applying a percentage tolerance.
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