When must the closing disclosure be re-disclosed, requiring a new three-day waiting period?

The correct response revolves around the guidelines set by the Truth in Lending Act and the Real Estate Settlement Procedures Act, which ensure that borrowers are kept informed about changes to their loan terms.

A new three-day waiting period is mandated when the Annual Percentage Rate (APR) increases by .125% or more. This requirement is in place because an increase in the APR indicates that the cost of the loan to the borrower has increased, thus impacting their long-term financial responsibility. The closing disclosure is designed to provide a clear summary of the loan terms, costs, and obligations, and ensuring adequate time for borrowers to review any changes before closing is essential to protect their interests.

While factors like interest rate decreases, changes in loan terms, and additional fees could necessitate some form of disclosure, they do not specifically trigger the same re-disclosure requirements as an increase in APR does. This ensures that borrowers fully understand the implications of higher costs associated with an increased APR before they finalize their loan.