True or False: If the actual amount exceeds the disclosed amount on the Loan Estimate, it indicates that the LE was not made in good faith.

The assertion that if the actual amount exceeds the disclosed amount on the Loan Estimate, it indicates that the Loan Estimate (LE) was not made in good faith is true because the LE is intended to provide borrowers with a clear and accurate understanding of the loan's terms and costs. Under Regulation Z, lenders are required to provide consumers with a good faith estimate of mortgage loan costs at the beginning of the process.

If the actual costs exceed those disclosed on the LE, this raises concerns about the lender's adherence to the requirement of providing a good faith estimate. The measure of good faith often relates to whether the lender performed due diligence to accurately estimate the costs, and exceeding those disclosed amounts could suggest a lack of adequate assessment or transparency on the lender's part. Non-compliance with this aspect of the regulation can lead to potential violations, penalties, and a loss of trust in the lender-consumer relationship.

In contrast, the other options might suggest a scenario where exceeding costs could be justified or dependent on other factors, which implies that there may be acceptable justifications for discrepancies between the LE and final terms. However, establishing good faith is primarily about ensuring that the disclosed information closely reflects actual costs.