| On July 30, 2008, Congress enacted the Housing and | | | | allowing a loan to close. The waiting period requires a |
| Economic Recovery Act of 2008 (HERA). Within | | | | lender to wait until the 7th business day following the |
| HERA, Congress included amendments to TILA which | | | | delivery or mailing of the initial TIL to the borrower(s) |
| are known as the Mortgage Disclosure Improvement | | | | before a creditor may close any loan. The 7 day |
| Act of 2008 (MDIA). On October 3, 2008 Congress | | | | period may be waived only if there is a bona fide and |
| further amended the Mortgage Disclosure | | | | or extreme and/or urgent reason to do so. This would |
| Improvement Act as part of the enactment of the | | | | be handled in the same manner as a waiver of |
| Emergency Economic Stabilization Act of 2008 | | | | rescission, which is virtually impractical to achieve. |
| (Stabilization Act). With the enactment of HERA and | | | | Therefore, there will be virtually no waivers of the 7 |
| the Stabilization Act, the Federal Reserve Board is | | | | day waiting period. C. Impose an additional 3 day |
| now amending Regulation Z with all provisions of the | | | | waiting period before a loan may close in any instance |
| MDIA and making these changes effective as of July | | | | in which the Truth In Lending(TIL) is outside of |
| 30, 2009. | | | | regulatory tolerances (e.G., for regular or fixed rate |
| The immediate changes you need to know about | | | | loans more than .125% and for irregular loans more |
| MDIA requirements are as follows: 1. MDIA implements | | | | than .25%). The 3 day period begins with the mailing of |
| a 3-7-3 rule that creates new timing and waiting | | | | the TIL. A corrected TIL is required whenever a TIL is |
| requirements with regard to the issuing of | | | | outside of regulatory tolerances. D. The TIL may be |
| Truth-in-Lending disclosures and when closing can | | | | mailed via regular mail or overnight or by e-sign or |
| occur. The 3-7-3 rule requires the lender to: A. Upon | | | | e-mail. However the lender sends the TIL, they must |
| the taking or receipt of a loan application, provide an | | | | still comply with the 3 day waiting period. MDIA does |
| initial Truth In Lending(TIL) to the borrower(s) within 3 | | | | not assume a quicker waiting period might occur and |
| business days of the application (no change to current | | | | does not allow the lender to proceed until after the 3 |
| requirement). B. Impose a waiting period BEFORE | | | | day waiting period has ended. |