Good Cause

An owner may consent to receive the preclosing disclosure or a modification of the preclosing disclosure on the date of closing if another good cause exists.  Good cause to modify the preclosing disclosure or to receive a subsequent disclosure modifying the preclosing disclosure on the date of closing may only be established by the owner.

“Good cause” as used in this section means a legitimate or justifiable reason, such as financial impact or an adverse consequence.  At the owner’s election, a good cause to modify the preclosing disclosure may be established if:

        the modification does not create a material adverse financial consequence to the owner; or

        a delay in the closing would create an adverse consequence to the owner.

At the owner’s election, a de minimis (very small or insignificant amount) good cause standard may be presumed if:

        the total actual disclosed fees, costs, points, and charges on the date of closing do not exceed in the aggregate more than the greater of $100 or 0.125 percent of the principal amount of the loan (e.g. 0.125 percent on a $80,000 principal loan amount equals $100) from the  initial preclosing disclosure; and

        no itemized fee, cost, point, or charge exceeds more than the greater of $100 or 0.125 percent of the principal amount of the loan than the amount disclosed in the initial preclosing disclosure.

To document a good cause modification of the disclosure, the lender should obtain a written statement from the owner that:

        describes the good cause;

        specifically states that the owner consents to receive the preclosing disclosure on the date of closing;

        bears the signature of all of the owners entitled to receive the preclosing disclosure; and

        affirms the owner has received notice of the owner’s right to receive a final itemized disclosure containing all fees, costs, points, or charges one day prior to closing.