TILA-RESPA (TRID) is here!
10/03/2015 - WHAT IS THE TILA-RESPA RULE?
On November 20, 2013, the Consumer Financial Protection Bureau (CFPB) issued its final rule to integrate the Real Estate Settlement Procedures Act (RESPA) and Truth In Lending Act (TILA) disclosures and regulations. The final rule integrates existing disclosures with new requirements from the Dodd-Frank Act to improve your understanding of the mortgage process, aid in comparison shopping, and help to prevent surprises at the closing table. The TILA-RESPA rule, also known as TRID (TILA-RESPA Integrated Disclosures) or “Know Before You Owe”, and all changes went into effect for applications taken on or after October 3, 2015.
WHAT CHANGES ARE HAPPENING?
NEW Loan Estimate
Say goodbye to the Good Faith Estimate (GFE), Truth in Lending (TIL), and a few other miscellaneous disclosures (at least for new applications as of October 3rd). TILA-RESPA has combined all of the necessary information into an easier to read 3-page disclosure called the Loan Estimate (LE). The Loan Estimate must be delivered to you within three business days after receiving a complete loan application.
NEW Closing Disclosure
The days of the HUD-1 Settlement Statement and Final Truth in Lending are now behind us. The new Closing Disclosure (CD) combines the information from both of these documents, along with a few other miscellaneous closing documents, to create a new 5 page document that is easily compared to the Loan Estimate when placed side by side.
The Closing Disclosure MUST be in your hands and acknowledged at least 3 days prior to closing. So, it is imperative that you return any requested information or documentation to us as quickly as possible throughout the process to avoid any closing delays.
LOAN APPLICATION – WHAT ARE THE INITIAL STEPS?
Once we have enough information to complete the loan application under TRID, we cannot require you to provide any borrower documents (paystubs, taxes, bank statements, etc.) until we deliver a Loan Estimate to you and you sign the Acknowledgement of Intent to Proceed. Once we receive that signed intent to proceed, goodmortgage.com will collect your application fee and appraisal fee, send the full initial disclosure package, order the appraisal, collect borrower documentation, and order title.
HOW WILL THE GOODSTART PRE-APPROVAL PROGRAM BE AFFECTED?
goodmortgage.com will continue to issue goodStart Pre-Approvals on purchases with addresses that are to be determined (TBD). If you need additional information on the goodStart program, please contact us.
WHAT DO WE NEED FROM YOU?
ALL ABOUT THE CLOSING DISCLOSURE
Who prepares the CD?
goodmortgage.com will prepare your Closing Disclosure by working with the Closing Agent you choose to ensure all fees are as accurate as possible prior to delivering the document to you. If you are purchasing a property, the Closing Agent will provide the seller a copy of their Closing Disclosure.
What if something changes on the CD? Will there be an additional wait to close?
In some situations, an additional 3-day review will be required if something on the Closing Disclosure changes. These will not be common occurrences, but you will need to keep them in mind if you want to request any changes. A final copy of the Closing Disclosure will always be provided to you at closing with all other closing documents.
A new 3-day review WILL be required when:
A new 3-day review will NOT be required when:
WHAT DOES ALL OF THIS MEAN FOR YOU?
For more information on the new TILA-RESPA rule and to view samples of the forms you will see, please visit