Question: We are a lender with some questions regarding disclosing the Closing Disclosure (CD). If we have a borrower and a co-borrower, must we send both individuals the CD for review? If we e-disclose, for the three day waiting period requirement do we use the date the disclosure was sent or the date we receive confirmation that the borrower received the CD? Lastly, if we have a non-purchasing spouse (NPS), can we add their name to the CD and have them sign at closing?
Answer
In a rescindable transaction, such as a refinance, the Closing Disclosure must be given separately to each consumer who has the right to rescind, which includes, in most states, a spouse not on title. In transactions that are not rescindable, such as purchases, the CD may be provided to any consumer with primary liability on the obligation. [12 CFR 1026.17(d)]
As to having the NPS sign at closing on a rescindable transaction, there is no requirement for the CD to be signed by the consumer under the TRID rules. The use of signature lines for documenting receipt of the disclosure is at the option of the creditor. That being said, you should ascertain whether or not this may be required by a specific loan program or investor to ensure a purchase of the loan.
With respect to notification through e-disclosure, if the creditor has evidence that the consumer received the CD earlier than three business days after it is mailed or delivered, the creditor may rely on that evidence and consider it to be received on that date. Most lenders and investors appear to be accepting the tracked opening of an email as receipt provided in conjunction with the E-Sign Act. However, this is not a universal practice, so make sure you check individual investor guidelines to determine what they will accept as evidence of receipt.
Joyce Pollison is director of legal and regulatory compliance for Lenders Compliance Group. She may be reached by phone at (516) 442-3456.
