A consumer is scheduled to consummate a covered mortgage on Friday. The creditor has not yet ensured receipt of the initial Closing Disclosure. What timing rule must be satisfied absent a valid waiver for a bona fide emergency?
Correct Answer
C) The consumer must receive it at least three business days before consummation
Why this is correct: Under the TRID rule, for most covered mortgage loans, the creditor must ensure the consumer receives the initial Closing Disclosure at least three business days before consummation (closing). This waiting period allows the consumer to review the final terms. This rule is strict, with waiver allowed only for a bona fide personal financial emergency. Why the other choices are wrong: The consumer must receive it only after consummation is wrong; receiving it after closing violates the mandatory pre-consummation review period. It may be delivered with the first periodic statement is wrong; the periodic statement is for after the loan is closed, not before. It must always be delivered exactly seven calendar days before consummation is wrong; the rule is three business days, not seven calendar days. Exam tip: Memorize the 'three business day' rule for the Closing Disclosure. Business days exclude Sundays and legal public holidays.
Why This Is the Correct Answer
Why this is correct: Under the TRID rule, for most covered mortgage loans, the creditor must ensure the consumer receives the initial Closing Disclosure at least three business days before consummation (closing). This waiting period allows the consumer to review the final terms. This rule is strict, with waiver allowed only for a bona fide personal financial emergency. Why the other choices are wrong: The consumer must receive it only after consummation is wrong; receiving it after closing violates the mandatory pre-consummation review period. It may be delivered with the first periodic statement is wrong; the periodic statement is for after the loan is closed, not before. It must always be delivered exactly seven calendar days before consummation is wrong; the rule is three business days, not seven calendar days. Exam tip: Memorize the 'three business day' rule for the Closing Disclosure. Business days exclude Sundays and legal public holidays.
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