Three-Day Closing Disclosure Rule
What is helpful for the REALTOR® to know?
- Creditors are responsible for providing the Closing Disclosure (CD); however a Creditor may contract with a Settlement Agent to have a CD provided to the consumer on behalf of the Creditor. The Creditor or Settlement Agent should allow 7 BUSINESS DAYS to provide the CD via mail or email. The 3 day rule applies if couriered with receipt or hand delivered. For the purpose of delivering the Closing Disclosure, “Business Days” is defined as follows:
All calendar days except Sundays and legal public holidays specified in 5 U.S.C. 6103(a)
- New Year’s Day
- Martin Luther King, Jr.’s Birthday
- Washington’s Birthday
- Memorial Day
- Independence Day
- Labor Day
- Columbus Day
- Veterans Day
- Thanksgiving Day
- Christmas Day
- Changes that require creditors to provide a new Closing Disclosure and an additional three-business-day waiting period after receipt include:
- Increases to the APR greater than 1/8 of a percent for most loans (and ¼ of a percent for loans with irregular payments or periods)
- Changes to the loan product
- Addition of a prepayment penalty to a loan
- “The customer can waive three-business-day waiting period for a bona fide financial emergency.” 12 C.F.R § 1026.19(f)(1)(iv) (eff. October 3, 2015).*
*Experts in the industry agree that customers will very rarely be granted the right to waive the three-business-day waiting period and ONLY in cases of extreme financial hardship. They also agree that hotel costs and moving expenses will not be considered a financial emergency.
For additional information and form samples, visit cfpb (Consumer Financial Protection Bureau) at www.consumerfinance.gov
