A team member asks about TILA TRID Loan Estimate in an investor-delivery review while trying to explain the required action to the team. Which response should a licensing coordinator use?
Correct Answer
C) Do not revise estimates without a valid trigger
Why this is correct: "Do not revise estimates without a valid trigger" is the required action because under TILA-RESPA Integrated Disclosure (TRID) rules, a Loan Estimate can only be revised under specific conditions, such as a valid changed circumstance (e.g., borrower-requested change, unforeseen event) or expiration. Arbitrary revisions to reset cost tolerances are prohibited. Why the other choices are wrong: To "Use a revised disclosure to reset tolerances without a documented event" is wrong because this circumvents the tolerance rules. To "Treat a rate lock as a changed circumstance for unrelated settlement fees" is wrong; a rate lock itself is not generally a valid changed circumstance for revising unrelated fees. To "Ignore redisclosure timing because the borrower verbally accepted the new terms" is wrong because verbal acceptance does not override the requirement to provide revised written disclosures within specified timeframes when a valid trigger occurs. Exam tip: Remember the four valid reasons for a revised Loan Estimate: changed circumstance, expiration, borrower request, or interest rate dependent charges.
Why This Is the Correct Answer
The correct response is "Do not revise estimates without a valid trigger" because Changed circumstances can permit revised estimates only when Regulation Z conditions and timing are met.
Why the Other Options Are Wrong
Option A: Use a revised disclosure to reset tolerances without a documented event.
This choice is a tempting shortcut, but it conflicts with changed-circumstance documentation because the file still needs the required documentation, timing, or rule-based review before the action is taken.
Option B: Treat a rate lock as a changed circumstance for unrelated settlement fees.
This choice is not the best answer because it applies the wrong file step for changed-circumstance documentation; the governing rule is tested by the correct option.
Option D: Ignore redisclosure timing because the borrower verbally accepted the new terms.
This choice is a tempting shortcut, but it conflicts with changed-circumstance documentation because the file still needs the required documentation, timing, or rule-based review before the action is taken.
Memory Technique
changed-circumstance review: identify the rule being tested, then choose the action that documents or applies that rule before the file moves forward.
Exam Tip
For changed-circumstance documentation questions, separate the required file step from plausible sales, timing, or documentation shortcuts.
Common Mistakes to Avoid
- -Choosing an internal exception instead of the governing rule
- -Treating preliminary or informal facts as a substitute for required documentation
- -Answering from a familiar but unrelated mortgage topic
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