IBA Compliance Connection

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Does a Closing Disclosure (CD) ever expire? We issued a CD, but the closing now has been delayed for 60 days. We plan to issue revised CDs if there are any changed circumstances, but we want to confirm that whatever we issue will not expire.

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Closing Disclosures do not have an expiration date. Regulation Z establishes a minimum but not a maximum number of days before closing that a CD generally must be provided. However, a CD must be accurate, so any changes that occur before closing — including a new closing date — must be disclosed on a revised CD.

If the annual percentage rate becomes inaccurate, the loan product changes, or a prepayment penalty is added to the transaction, you must provide corrected disclosures at least three business days before the new closing date. Any other changes, including a new closing date, will require a revised CD, but will not require a three-day waiting period and may be given to the borrower at closing.

For resources related to our guidance, please see:

  • Regulation Z, 12 CFR 1026.19(f)(1) (“Except as provided in paragraphs (f)(1)(ii)(B), (f)(2)(i), (f)(2)(iii), (f)(2)(iv), and (f)(2)(v) of this section, the creditor shall ensure that the consumer receives the disclosures required under paragraph (f)(1)(i) of this section no later than three business days before consummation.”)

  • Regulation Z, 12 CFR 1026.19(f)(2)(i) (“Except as provided in paragraph (f)(2)(ii), if the disclosures provided under paragraph (f)(1)(i) of this section become inaccurate before consummation, the creditor shall provide corrected disclosures reflecting any changed terms to the consumer so that the consumer receives the corrected disclosures at or before consummation.”)

  • Regulation Z, 12 CFR 1026.19(f)(2)(ii) (“If one of the following disclosures provided under paragraph (f)(1)(i) of this section becomes inaccurate in the following manner before consummation, the creditor shall ensure that the consumer receives corrected disclosures containing all changed terms in accordance with the requirements of paragraph (f)(1)(ii)(A) of this section:

    • The annual percentage rate disclosed under § 1026.38(o)(4) becomes inaccurate, as defined in § 1026.22.
    • The loan product is changed, causing the information disclosed under § 1026.38(a)(5)(iii) to become inaccurate.
    • A prepayment penalty is added, causing the statement regarding a prepayment penalty required under § 1026.38(b) to become inaccurate.”)