What changes can realtors expect with TRID? Unless you’ve been out of the country for an extended period of time, you’ve probably heard about the industry-changing TILA-RESPA Integrated Disclosure Rule Implementation (TRID) going into effect on October 3. It was originally scheduled to take place in August of this year, but the Consumer Financial Protection Bureau (CFPB) has pushed it back due to an administrative error.
In a nutshell, these changes simplify forms, create additional mortgage disclosure forms and more complex compliance for lenders. As a realtor, here are the changes you can expect:
Great Insight for Buyers
In the past the closing forms were a bit obscure and numbers were tricky to understand. With the new forms, the numbers are clearly enumerated. This is a bane and a boon. Buyers will have more insight into what they are signing, but this may create many more questions and disagreements for you to manage.
Time to Close May Become Longer (Initially)
While the industry’s working things out under the new rule, quick closes may not be possible. Two forms, which require buyer’s sign-off, may hinder that. The Loan Estimate form must be presented to the buyer three days after the loan application. The Closing Disclosure form is due three days before closing.
Changes Must Be Approved
Another part of the new system that is worried to cause slowdown involves changes made to the Loan Estimate and/or the Closing Disclosure document(s). In the past, the closing estimate provided approximate numbers, and it was not an issue if they changed slightly. For some, it was an expectation that they would. No longer. If anything changes, the buyer must be notified and the forms resubmitted for another approval. The buyer then has three days to approve the change(s). This stipulation is going to ensure that all paperwork is finalized with time to spare or risk failure to close on the scheduled date.
The Lending Industry is Unsure of the How the Changes Will Affect Schedules
Although the CFPB pushed the effective date back to October, many lenders are asking them for an early compliance period to test their new process. The Director of Regulatory Affairs for the National Association of Federal Credit Unions Alicia Nealon said, “While NAFCU is pleased by the CFPB’s proposed extension of the effective date of the TILA-RESPA Integrated Disclosures, it is disappointing the CFPB has not taken this opportunity to permit an early compliance period that will provide credit unions with valuable time to test their systems before the implementation date. NAFCU will continue to urge CFPB to reconsider its position on this issue.” The CFPB announced earlier that they would provide a good-faith enforcement grace period that would most likely extend through the end of 2015.
If you’re concerned about how these changes will affect your clients’ closings, look to partner with a real estate law firm that is prepared. We’ve been on top of these changes, modifying workflows, since they were first announced in late 2013. At Fitzgerald Law Offices customers come first, and we’ll do everything we can to ensure a seamless closing experience. Contact us today at to find out how we can work together…781-924-5326.