Under the 3/7/3 rule, what may be collected with the Loan Estimate within 3 business days?

Under the 3/7/3 rule, what may be collected with the Loan Estimate within 3 business days?

• A. Only the cost of the credit report
• B. All closing costs
• C. The full loan amount
• D. The appraisal fee

Answer: (A)

The key idea is how TRID’s timing rules limit what fees can be charged and shown on the Loan Estimate in the first three days after an application. The Loan Estimate is meant to give a clear, early snapshot of anticipated costs, but only certain items may be collected in that initial window. The cost to obtain the borrower’s credit report is a standard, known item that a lender typically orders right away to evaluate creditworthiness, so it may be charged and listed on the Loan Estimate within three business days. Other items—like the appraisal fee, the total estimated closing costs, or the full loan amount—depend on services and terms that aren’t fixed or ordered yet at this early stage, so they aren’t collected (or guaranteed) in that initial three-day period. The appraisal would be ordered later as the loan progresses, and closing costs are finalized closer to closing, with the Closing Disclosure providing the updated figures.

The key idea is how TRID’s timing rules limit what fees can be charged and shown on the Loan Estimate in the first three days after an application. The Loan Estimate is meant to give a clear, early snapshot of anticipated costs, but only certain items may be collected in that initial window. The cost to obtain the borrower’s credit report is a standard, known item that a lender typically orders right away to evaluate creditworthiness, so it may be charged and listed on the Loan Estimate within three business days. Other items—like the appraisal fee, the total estimated closing costs, or the full loan amount—depend on services and terms that aren’t fixed or ordered yet at this early stage, so they aren’t collected (or guaranteed) in that initial three-day period. The appraisal would be ordered later as the loan progresses, and closing costs are finalized closer to closing, with the Closing Disclosure providing the updated figures.