Which HOEPA disclosure occurs 3 days before closing?

Which HOEPA disclosure occurs 3 days before closing?

• A. Borrower receives additional disclosure 3 days prior to closing
• B. Disclosures provided at the time of application
• C. Disclosures provided after closing
• D. No disclosures are required

Answer: (A)

HOEPA requires a separate set of disclosures for high-cost mortgages, and these must be provided to the borrower at least three business days before closing. This pre-closing HOEPA disclosure explains that the loan is high-cost and lays out the terms and costs (such as the APR and the total points and fees) so the borrower has time to review, compare, or reconsider before committing. That’s why the correct option is that the borrower receives an additional disclosure three days prior to closing. Disclosures at application come from general TILA/RESPA timing, not the HOEPA pre-closing notice; disclosures after closing aren’t allowed for this purpose, and claiming none are required isn’t correct.

HOEPA requires a separate set of disclosures for high-cost mortgages, and these must be provided to the borrower at least three business days before closing. This pre-closing HOEPA disclosure explains that the loan is high-cost and lays out the terms and costs (such as the APR and the total points and fees) so the borrower has time to review, compare, or reconsider before committing. That’s why the correct option is that the borrower receives an additional disclosure three days prior to closing. Disclosures at application come from general TILA/RESPA timing, not the HOEPA pre-closing notice; disclosures after closing aren’t allowed for this purpose, and claiming none are required isn’t correct.