Can someone please confirm... if I e-mail early disclosures (under the rules of the E-Sign Act) within 3 days of application and I get an email back from the customer saying they got them, do I still have to wait 7 business days before I close the loan or can I reduce the waiting period to 3 business days (by removing the mailing days) from acknowledgment of receipt? Thank you.

This is VERY unlikely to happen, but just want to understand the rule. It WOULD be possible for a re-disclosure scenario.

The seven-business-day waiting period begins when the creditor delivers the disclosures or places them in the mail, not when the consumer receives or is considered to have received the disclosures.

I'm a wee bit confused. 1026.19(f)(1)(iii)

If the closing disclosure is mailed or delivered electronically, it is considered received three business days after delivery.

If the creditor has evidence that the Closing Disclosure earlier than the three business days after delivery, it may rely on that evidence and consider it received on that date.

Now I wouldn't rely on an e-mail saying the consumer received it but if he signed and returned it to me, that should reduce the delivery wait time

Correct?

They were talking about the Loan Estimate, which must be issued at least 7 business days prior to closing. You are correct, the Closing Disclosure must be delivered received at least 3 business days prior to closing. How you evidence borrower's receipt will be up to you, but if it's mailed then it can be assumed received on the third business day after mailing.

There is one nuance to the E-SIGN aspect for the early disclosures that you should be aware of. Some lenders/vendors include the initial E-SIGN disclosure and consent in the same package with the early disclosures. If the applicant does not open and consent to the E-SIGN within the 3 business days after application, then you have NOT sent the disclosures within the 3 business days even though you did email them. Without the E-SIGN Consent, sending the disclosures by email is just the same as not sending them at all. We solved by monitoring for the E-SIGN consent by 10am of 3rd business day after application and if E-SIGN consent has not been received by that time, we will send the early disclosures via postal mail even though we had already emailed them.

How do you plan on handling the e-mailing of the Closing Disclosure? Are you going to email it more than 3 business days before closing? It has to be received 3 business days before closing so if it were sent 3 business days before closing via email it would have to be opened/acknowledged that day in order to not delay closing, right?

BeechFlyboy. Don't forget that when you email them and then later are forced to send them via postal mail, you will need to update the issue date and other date related fields...Our doc prep folks aren't liking that requirement too much.

Raiders - we think of email just like postal service mail. WE plan for the disclosure to take 3 days to get there. the only difference being that sometimes we will get lucky and have evidence that it was received sooner than 3 business days.

I have found that banks that successfully use email/esign for disclosures have close contact with the borrower in that phase. The LO walks them through, because the LO wants the deal to be completed!

"Ok, we are sending the disclosures now, please check your email and let me know as soon as you have the disclosures." Then, "did you receive them?" The customers seem to watch for it and respond qu.ickly because they have been educated in the process and the need to reply quickly.

The whole email chain is in the file.

^^^This^^^

We will be putting together a flyer on TRID for new borrowers after August first, and a key component of that piece will be the need to complete establishing a secure email and Esign, and then drill in the importance of responding to emails as quickly as possible to keep the process moving.

For LOs that do not get the tech side of it yet, this will be a major cultural shift for them... they can no longer play dumb with tech. They have to get on board or they will be left behind.

Here's a fun little twist on the CD portion of this:

We have customers who have the same email address, but both of them need to receive the CD so we send separate emails to each of them through our DocuSign program to the same email address with the same CD document. One of them opens it and both of them look at that one.

The other email does not get opened.

Can we still close? Do we absolutely have to have that other email opened? Can we close with a memo or something from the customer stating that he looked at the document when his wife opened it?

Is the transaction subject to the right of rescission? If it is, you have no documented delivery of the material disclosures to all required parties and therefor you would extend the right of rescission for three years.

Assuming that delivery was e-SIGN sanctioned, and you don't require an acknowledgment of receipt (unless you don't want to allow the three-day delivery assumption requirement), I don't see a problem. You would not have a problem if you had done everything via paper in separate envelopes. But if your DocuSign arrangement is such that the email has to be opened before the E-SIGN agreement can be executed and the documents subsequently read, I agree with Randy. The second party never received a timely delivery of the disclosures.

Another curve ball regarding a situation I've run into....If the initial CD was delivered electronically to a borrower who is in a different time zone from the bank, we receive evidence that the borrower received the disclosures at 12:15 a.m. (borrower's time zone) which happens to be 10:15 p.m. of the previous day in the bank's time zone, which day do we consider the documents to be received by the borrower? So far I have not been able to find any clear guidance for this scenario.

They get them when they get them. They got them the next day.