1 * C O N F I D E N T I A L * Duplication and/or distribution of this document without prior written approval from BofI is strictly prohibited.

2 SectionContentsPage Number TRID Overview: What is TRID?3 Definition of an Application4 Loan Estimate (LE): Timing Requirements6 Business Day Definition7 FAQ’s8 Evidence of receipt of LE9 Submission Requirements10 Change of Circumstance11 Closing Disclosure (CD): Timing13 Re-disclosure14 Who must receive CD?15 Proof of Receipt16 Calendar17 FAQ’s18 Seller signed CD19 Tolerance Categories20 Summary: Summary21

 TRID combines four (4) disclosures that are required under TILA and RESPA into two forms.  The initial TIL and GFE will be replaced by the Loan Estimate (LE)  The final TIL and HUD will be replaced by the Closing Disclosure (CD)  The rule is under Reg. Z and goes into effect on October 3, Loan Estimate (LE) GFE Initial TIL Closing Disclosure (CD) HUD Final TIL

4  Once a lender receives the 6 pieces of information, an application has been triggered.  No more requiring a 7 th item before considering the loan as an application. Property Address P Estimated Value E Name N Credit (social security number to pull credit) C Income I Loan amount L  A Loan Estimate (LE) must be provided to the consumer within 3 business days of receiving an application.  Cannot charge a consumer, other than a bona fide credit report fee, until they have received the LE and indicated an intent to proceed.  Note: BofI will not accept an Loan Estimate dated prior to the application date.

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6  Initial LE must be delivered within 3 specific business days of the application date (Does not include Saturday if Lender is not open for business)  The Initial LE must be provided to the borrower no later than 7 general business days before consummation (calendar days except Sundays and Federal Holidays)  All Change of Circumstance Loan Estimates must be provided within 3 business days of the COC event (waiting periods apply if APR increases by more than 0.125%)  Note: if an application is denied or withdrawn within 3 business days, the LE is not required and the application under the same terms cannot be reactivated.

Specific Business Day For purposes of providing the Loan Estimate, or any revised Loan Estimate, a business day is a day on which the creditor’s offices are open to the public for carrying out substantially all of its business functions. (Specific Business Day – used for the purposes of determining the last day the LE must be delivered) General Business Day For all other purposes, business day means all calendar days except Sundays and legal public holidays recognized by the Federal Reserve. (General Business Day - used for counting all applicable wait periods) Mailbox rule It is presumed a borrower receives a disclosure on 3 rd general business day after it is delivered or placed in the mail. The mailbox rule is used when there is no proof the borrower received the disclosure. 7

8 Who must receive a copy of the Loan Estimate?  On rescindable transactions, the LE must be given to each consumer who has the right to rescind under TILA. NOTE: Non-borrowing spouses/individuals on Title are required to receive the Loan Estimate – proof of receipt will be required. (Section (d) Regulation Z)  On non-rescindable transactions, the LE may be provided to any consumer with primary liability on the obligation. Does BOFI require the loan estimate to be executed by the borrower (s)?  Yes, the loan estimate must be executed by the borrower(s). Can the loan officer request any income or asset documentation prior to receipt of the intent to proceed?  No the loan officer cannot request any documentation until the borrower has given their intent to proceed.

 NOTE: We recommend all Correspondents engage an e-sign/e-delivery vendor and implement the necessary procedures for documenting proof of receipt of the Loan Estimate and Closing Disclosure. 9 Evidence of consumer receipt through acknowledgement from consumer. Evidence of electronic receipt – read receipt.Signing for a UPS/FedEx package

10  Attestation: Seller must complete the online TRID Attestation on the BofI Lending Partners website for each loan that is submitted. (Found in the “Submit My Loan” screen) “By submitting this application I certify I have complied with BofI submission requirements and the changes under the TRID rules? Y, N or N/A?  Evidence of Receipt of Loan Estimate by required parties (See page 7 for information on who must receive a copy of the LE)  A detailed fee sheet – must match your Loan Estimate  Intent to proceed  Loan applications dated on or after 10/3/2015 must have initial disclosures, including the Loan Estimate (LE) and “Your Home Toolkit” (Purchases only) dated within 3 days of the application date (In compliance with RESPA)  Settlement Service Provider List must be provided and list any affiliated companies.  1003 Must be dated and signed by Loan Officer and reflect NMLS numbers.

 An extraordinary event beyond the control of any interested party or other unexpected event specific to the borrower or transaction;  Information specific to the borrower or transaction that the creditor relied upon when providing the LE and that was inaccurate or changed after the disclosures were provided;  New information specific to the borrower or transaction that the creditor did not rely on when providing the LE Per CFPB:  “Creditors may only use revised or corrected Loan Estimates when specific requirements are met. Creditors generally may not issue revisions to Loan Estimates because they later discover technical errors, miscalculations, or underestimations of charges. Creditors are permitted to issue revised Loan Estimates only in certain situations such as when changed circumstances result in increased charged.” Note: The last revised LE must be issued at least 1 business day (includes Saturday) prior to issuing the CD.. 11

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13  Must be provided to the consumer at least 3 business days before consummation.  Once a CD is provided to the consumer, a revised LE cannot be issued.  Must be delivered at least 3 general business days prior to consummation (calendar days except Sundays and Federal Holidays). Consummation is the date the consumer signs the note and other loan documents.  If a revised CD must be provided, an additional 3 business day waiting period only applies under certain circumstances - see page 14 for guidance.  A CD may not be delivered the same day as an LE is issued.

14 Pre-consummation: A new 3 business day (Includes Saturday) waiting period applies when there are:  Changes to the loan’s APR; or (increase by more than 0.125%)  Changes to the loan product; or  The addition of a prepayment penalty If other types of changes occur, the borrower must receive a corrected CD at or before consummation. Post-consummation event(s) that would require a new CD Examples:  A recording fee paid by the borrower is different from the amount that was disclosed on the CD (provide within 30 calendar days).  Non-numerical clerical errors and refunds for tolerance violations (provide within 60 calendar days of consummation). Clerical error = doesn’t affect the numerical disclosure and does not affect the timing delivery.  Incorrect settlement service provider listed is OK.  Wrong property address is NOT OK (affects the delivery requirement and is not considered clerical).

15  In rescindable transactions, we require proof that each borrower (including non-borrowing spouses/individuals) have received the CD. The clock starts counting after the last borrower has provided proof of receipt.  In non-rescindable transactions, we require proof that one of the consumers with primary liability on the obligation has received and acknowledged receipt.  Sending the LE is not sufficient proof of receipt – you are required to document the borrower(s) received the CD.

16 How should Lenders document proof of receipt of the CD? Evidence of consumer receipt through acknowledgement.Evidence of electronic receipt – read receipt.Signing for a UPS/FedEx package.Electronic delivery that complies with ESIGN + three business days.Mailbox rule : Mailing date + three business days. Mailbox rule will be used if the consumers eConsent was not received prior to delivering the CD.

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18 Does the CD have to be executed by the borrower(s)?  Yes, BofI requires the CD to be executed. The “Final” CD must be signed with closing documents. What if the If the borrower does not acknowledge receipt of the CD?  If the borrower does not acknowledge receipt of the CD there will be a 6 day wait before borrower can sign loan docs. (3 day mail, and 3 day wait) Can the borrower waive the 3-day waiting period?  No, BofI will NOT accept Hardship Letters in lieu of required TRID waiting periods Who should prepare the CD?  The Lender or the Closing Agent can prepare the CD, but the lender is ultimately responsible.  Texas loans require a CD to be prepared by an attorney. Can a CD be issued instead of an LE if the scheduled close date is less than 4 business days from rate lock date?  This should be an exception not the rule. BofI prefers the borrower to receive a revised Loan Estimate for a rate lock.

19 Purchase transactions: the settlement agent is required to provide the seller with the CD reflecting the actual terms of the seller’s transaction.  The settlement agent may provide the seller with a copy of the CD that was provided to the buyer if it also contains information relating to the seller’s transaction.  The settlement agent may provide a separate disclosure to the seller, including only the information applicable to the seller’s transaction from the CD. However, if the seller’s disclosure is provided in a separate document, the settlement agent has to provide the creditor with a copy of the disclosure provided to the seller. Does the Seller signed CD need to be signed?  Yes, the seller signed CD will need to be executed by the sellers.

0% Tolerance10% ToleranceNo Tolerance Paid to creditorRequired 3 rd party services the borrower CAN shop for but DID NOT shop for Prepaid Interest Paid to brokerRecording feesProperty Insurance Premiums Paid to affiliateAmounts placed into escrow Required 3 rd party services the borrower CANNOT shop for Required 3 rd party services the borrower CAN shop for and DID shop for Transfer TaxesNon-required 3 rd party services 20

 Fully understanding the changes required may involve a review of your existing business processes, as well as the hardware and software that you or other business partners use.  You will find the TILA-RESPA rule on the Bureau’s website at  Useful resources related to mortgage rule implementation are also available at  The information provided in this presentation is limited to Bofi’ s policies with respect to the TILA-RESPA integrated disclosure rule. This is not to be considered regulatory compliant and/or legal advice and is subject to change without notice. You are encouraged to reach out to your compliance/legal department for guidance. 21