Within how many calendar days must a lender cure a tolerance violation?

A tolerance violation occurs when the actual closing costs exceed the estimated costs provided to the borrower within certain limits established by regulations like RESPA (Real Estate Settlement Procedures Act). The requirement for lenders to correct such violations is necessary to ensure compliance with consumer protection laws and maintain transparency in lending practices.

In the case of a tolerance violation, the lender has a specific timeframe to "cure" the violation to remain in compliance. The correct timeframe is 60 calendar days. This means that once a lender knows there has been a violation regarding the costs that were initially disclosed, they are required to resolve the issue and inform the borrower within 60 days to rectify the situation.

This timeframe is laid out to protect consumers and ensure that they are fully informed of their closing costs, allowing them to make educated decisions without encountering unexpected financial burdens at closing. It also helps to maintain the lender's reputational integrity and commitment to fair lending practices.