I get this question a lot and the Bureau got it a lot at the time they were putting the rule together. What the Bureau said in response was to point back to the obligation that I know I keep harping on, but it is the answer to many of these questions: the obligation to disclose based on the best information reasonably available at the time the estimate is provided. The Bureau has said that deliberately “padding” or overdisclosing is not disclosing the best information reasonably available. Instead, you should be looking to your own experience in that particular jurisdiction as to what things typically cost or to the settlement agent or the realtor or other parties that have information that allows you to provide a good faith estimate. But deliberately highballing it, in addition to creating a competitive issue, could put you out of compliance.
Note: This transcript has been edited from the February 2015 TRID webinar for clarity and completeness.
Answered By: Ben Olson