Tag Archives: RESPA

BIG CHANGES AS OF OCTOBER 3, 2015

sign contract

A FEW THINGS YOU MUST KNOW BEFORE BUYING OR SELLING A HOME!

In an effort to empower and protect consumers when purchasing a home with a mortgage, the Dodd-Frank Wall Street Reform and Consumer Protection Act directed the Consumer Financial Protection Bureau (CFPB) to integrate mortgage loan disclosures.  What you must know is that on October 3, 2015 “TRID” was implemented.  TRID is an acronym for TILA/RESPA Integrated Disclosure.  (TILA – Truth in Lending Act, RESPA – Real Estate Settlement Procedures Act) Confused yet?  Let me explain briefly what this is, and what it means to you if you or someone you care about will be buying or selling a home in the near future.

TRID is being affectionately called “Know Before You Owe”.  The intent is have processes in place whereby lenders must disclose all fees and terms of loan within a certain time frame, and to give buyers an opportunity to shop the terms of the loan.  I recently attended a 3 hour CE class on this topic and the take away is that these new government regulations will significantly impact the way we have done business in the past.  Most notably, the typical timelines in a real estate contract, especially the closing and possession dates, will most certainly be impacted.  It would appear that the days of a 30 day closing are a thing of the past.  I have spoken with several top lenders and closing attorneys around town, and while most seem to have processes already in place to deal with these new regulations, no one really knows for certain what the impact will be.

One thing IS certain, is it absolutely imperative that if you are buying or selling a home that you partner with a real estate professional who is knowledgeable on this topic and who can refer you to the lenders, closing attorneys, and other partners in the real estate transaction who can guide you best.   The CFPB means business, and you do not want to engage in real estate contract until you have the facts on how you may be impacted, whether you are on the buying or selling side of the transaction.

For more information on TRIDhttp://www.consumerfinance.gov/know-before-you-owe

Dodd Frank

http://www.cftc.gov/idc/groups/public/@swaps/documents/file/hr4173_enrolledbill.pdf

Consumer Financial Protection Bureau

http://www.consumerfinance.gov/

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