Refund and corrected disclosure used when actual mortgage charges exceed the applicable Loan Estimate tolerance.
A tolerance cure is the refund and corrected disclosure used when actual mortgage charges exceed the applicable Loan Estimate tolerance.
A tolerance cure restores the borrower to the amount permitted by the TRID good-faith rules. It is not a finding that every final cost had to match the first estimate. The cure applies only when a charge in a restricted tolerance category exceeds its valid comparison amount.
The valid comparison amount may come from the original Loan Estimate, a timely Revised Loan Estimate, or a permitted corrected Closing Disclosure. An informational revision that did not satisfy the rule does not necessarily reset the baseline.
The cure is a compliance correction, not a courtesy concession or negotiated pricing credit. The creditor generally must refund the excess and provide a corrected Closing Disclosure no later than 60 calendar days after Consummation.
Borrowers may see a cure before closing on the final Closing Disclosure or after closing on a corrected disclosure accompanied by a refund. The post-closing timing does not mean the overage became permissible; the rule provides a limited period to correct it.
The term becomes practical when the borrower compares actual charges with the controlling estimate and sees a lender-paid amount, refund, or correction that was not part of the original loan pricing.
| Fee treatment | General comparison |
|---|---|
| Zero-Tolerance Charges | Restricted charge generally may not increase above its valid disclosed amount |
| 10% Cumulative Tolerance | Sum of covered charges generally may not rise by more than 10% above the valid disclosed sum |
| Charges allowed to vary | Good faith generally depends on using the best information reasonably available rather than a fixed percentage cap |
A single fee in the 10% bucket can increase by more than 10% without requiring a cure if the total covered bucket remains within 10%. Conversely, several modest increases can create a cure when their combined total exceeds the permitted limit.
| Stage | Borrower sees | Why it matters |
|---|---|---|
| Early estimate | Original disclosed charges | Establishes the initial baseline |
| Valid revision | Affected charge and documented reason | May replace the baseline for that charge or bucket |
| Final review | Actual charge paid or imposed | Shows whether the applicable tolerance was exceeded |
| Cure | Refund plus corrected Closing Disclosure | Returns the excess and documents the correction |
| Step | Why it matters |
|---|---|
| Identify the controlling estimate | The newest document is not always the valid baseline. |
| Classify the fee | Zero-tolerance and 10% cumulative charges are tested differently. |
| Match the permitted revision reason | A valid change resets only the amount it actually affected. |
| Compare the actual charge | The cure equals the amount above the applicable permitted limit. |
| Verify the refund and corrected disclosure | Both are part of the post-closing cure path. |
Assume the valid disclosed total for charges in the 10% cumulative bucket is $2,000. The maximum total without another permitted revision is generally $2,200. The actual covered charges total $2,275, so the excess is $75.
The creditor refunds $75 and sends a corrected Closing Disclosure showing the cure. If this occurs after consummation, both actions generally must be completed within 60 calendar days.
For a zero-tolerance example, assume a restricted $1,100 origination charge appears as $1,175 at closing without a permitted revision. The $75 excess is evaluated charge by charge rather than inside the 10% pool.
A tolerance cure differs from a Changed Circumstance because the changed circumstance may permit a revised baseline, while the cure refunds an excess over the baseline that actually controls.
It differs from Lender Credits. A lender credit is usually part of the loan’s pricing tradeoff. A tolerance cure is not exchanged for a higher rate and should not consume a negotiated lender credit already promised to the borrower.
It differs from 10% Cumulative Tolerance. The tolerance is the permitted group limit; the cure is the remedy for exceeding that limit.
It differs from a corrected Closing Disclosure generally. A Closing Disclosure can be corrected for several reasons, while a tolerance cure specifically addresses an excess over an applicable fee limit.