TRID Tolerance
Classifies fees into tolerance buckets, calculates CD-vs-LE variances, validates changed circumstances, and computes cure amounts under Regulation Z.
Prerequisites
- Loan Estimate (original + any revised, with dates)
- Closing Disclosure (final or proposed)
- Creditor's written list of service providers (shopped vs. unshopped classification)
- Documentation of any changed circumstances
Tolerance Categories
Zero Tolerance (0%) — Cannot Increase
Any increase requires a valid changed circumstance and revised LE.
| Category |
Examples |
| Creditor/broker fees |
Origination, application, underwriting, processing, discount points, commitment, rate lock |
| Affiliate fees |
Any fee paid to lender/broker affiliate (title, appraisal, etc.) |
| Transfer taxes |
State/local transfer tax, mansion tax, documentary stamps |
| Services borrower cannot shop for |
Appraisal (creditor-selected), credit report, flood determination, tax monitoring |
10% Cumulative Tolerance
The aggregate total of all 10% items on CD cannot exceed the aggregate total on LE by more than 10%.
| Category |
Examples |
| Recording fees |
Deed recording, mortgage/deed of trust recording |
| Shopped services (from lender's list) |
Lender's title, settlement/closing, title search, survey, notary, pest, attorney |
If borrower chose a provider not on lender's written list, that fee shifts to unlimited tolerance.
Unlimited Tolerance
May change freely; original LE must have been made in good faith.
- Prepaid interest, insurance premiums (homeowner's, flood, MI)
- Initial escrow deposits (taxes, insurance, MI, aggregate adjustment)
- Property costs not required by creditor (HOA, assessments, prepaid taxes)
- Services from a provider not on lender's list
- Optional services (home warranty, optional owner's title, elective inspections)
Variance Calculation
Zero Tolerance
For each zero-tolerance fee: Variance = CD Amount − LE Amount
- Compliant: every variance ≤ $0
- Violation: any positive variance is the cure amount for that fee
10% Cumulative Tolerance
1---2name: trid-tolerance3description: Classifies closing costs into zero, 10% cumulative, and unlimited tolerance buckets under 12 CFR § 1026.19(e)(3). Validates changed circumstances for revised Loan Estimates and computes cure amounts. Use when reviewing a Closing Disclosure against a Loan Estimate, calculating tolerance variances, determining whether a revised LE is permitted, or computing cure amounts for tolerance violations.4---5
6# TRID Tolerance
7
8Classifies fees into tolerance buckets, calculates CD-vs-LE variances, validates changed circumstances, and computes cure amounts under Regulation Z.
9
10## Prerequisites
11
121. Loan Estimate (original + any revised, with dates)
132. Closing Disclosure (final or proposed)
143. Creditor's written list of service providers (shopped vs. unshopped classification)
154. Documentation of any changed circumstances
16
17## Tolerance Categories
18
19### Zero Tolerance (0%) — Cannot Increase
20
21Any increase requires a valid changed circumstance and revised LE.
22
23| Category | Examples |
24|---|---|
25| Creditor/broker fees | Origination, application, underwriting, processing, discount points, commitment, rate lock |
26| Affiliate fees | Any fee paid to lender/broker affiliate (title, appraisal, etc.) |
27| Transfer taxes | State/local transfer tax, mansion tax, documentary stamps |
28| Services borrower cannot shop for | Appraisal (creditor-selected), credit report, flood determination, tax monitoring |
29
30### 10% Cumulative Tolerance
31
32The **aggregate total** of all 10% items on CD cannot exceed the aggregate total on LE by more than 10%.
33
34| Category | Examples |
35|---|---|
36| Recording fees | Deed recording, mortgage/deed of trust recording |
37| Shopped services (from lender's list) | Lender's title, settlement/closing, title search, survey, notary, pest, attorney |
38
39If borrower chose a provider **not on lender's written list**, that fee shifts to unlimited tolerance.
40
41### Unlimited Tolerance
42
43May change freely; original LE must have been made in good faith.
44
45- Prepaid interest, insurance premiums (homeowner's, flood, MI)
46- Initial escrow deposits (taxes, insurance, MI, aggregate adjustment)
47- Property costs not required by creditor (HOA, assessments, prepaid taxes)
48- Services from a provider **not** on lender's list
49- Optional services (home warranty, optional owner's title, elective inspections)
50
51## Variance Calculation
52
53### Zero Tolerance
54
55For each zero-tolerance fee: `Variance = CD Amount − LE Amount`
56
57- Compliant: every variance ≤ $0
58- Violation: any positive variance is the cure amount for that fee
59
60### 10% Cumulative Tolerance
CaseMark