According to TRID, what is considered a zero tolerance item on the Loan Estimate?

The correct choice highlights the origination fee as a zero tolerance item under the TILA-RESPA Integrated Disclosure (TRID) rules. Zero tolerance items are those costs that cannot increase from the Loan Estimate to the Closing Disclosure.

An origination fee is charged by the lender for processing the loan, and this fee is outlined on the Loan Estimate. Because it is a fee directly related to the loan provided, any increase in this charge after the initial estimate would not be permitted. The goal of TRID is to provide clarity and certainty to borrowers, and part of achieving that is ensuring that certain critical fees remain stable throughout the lending process.

On the other hand, other fees like discount points, appraisal fees, and title insurance fees have tolerances that may allow for some variation. For example, while discount points also typically fall under certain tolerances, they can sometimes adjust due to market conditions. Thus, they do not carry the same strict zero tolerance policy as origination fees do. Understanding these distinctions is crucial in ensuring compliance with TRID regulations and protecting the consumer's interest in the mortgage process.