More On Energy Conservation And New Regulations!

More On Energy Conservation And New Regulations!

Conserve your energy on TRID until more policies and approaches are developed.

I’m on an earth day theme, but I think that it is really important to talk about TRID. The TILA-RESPA Integrated Disclosure, or TRID, is the pending regulation that goes into effect on most real estate sales transactions on and after August 1st.

Companies are still making their legal and compliant decisions on how they will approach certain aspects of the TRID regulation. Many of these regulations are open for interpretation and lenders need to determine their policies and procedures for these new rules.

TRID Basics:

TRID is a merger of the TIL and the GFE, the upfront disclosures that go to consumers once they have applied for a mortgage. These forms are being combined into one form called the Loan Estimate (LE) on the front end. In the back end, TRID merges the final TIL and the HUD into one form called the Closing Disclosure (CD).

– As with current disclosures, the new LE forms are required to be delivered within three business days of application

– CD Forms must be delivered three business days prior to closing

– If there is a change in APR, loan product or if a pre-payment penalty is added, the three business day clock re-sets and the closing will be delayed

– Any change in final numbers that do not impact the APR must be approved by lender before closing

The goal of this regulation is to ensure that consumers have enough time to understand the numbers in the mortgage transaction. Once a lender issues the LE, those numbers cannot adjust without a legitimate change of circumstance. At the closing, the numbers should match the initial LE, unless the consumer was notified of a legitimate change. Although the industry has changed a lot, there are still borrowers who voiced that the numbers at closing were not as expected. By the time they got to the table, there was nothing that could have been done so they closed. Now the consumer will have ample time to make sure they understand all the numbers and the lender will have to have everything in order to ensure an on-time closing.

Some TRID basics to help insure there are no closing delays:

You will be hearing more about this regulation as the implementation date of August 1st grows closer and companies firm up their interpretation and approach to TRID.

We all work together to get the buyer and seller to a happy closing table. Real estate agents can support this system by helping to educate buyers. Title agents and attorneys need to complete title orders up front, and consumers need to obtain homeowner\’s insurance early as well as transferring funds early in the process to get the loan clear to close. Nothing impacting the loan application and documentation can be left to the end of the process. Doing everything as early as possible will help ensure timely closings.

TRID TIPS…

– Allow at least two weeks from mortgage commitment date to closing so all conditions can be cleared and the closing numbers can be produced, reviewed and accepted. This will ensure there will be no delay in the closing.

– Counsel buyers to respond to all lender requests with speed. Make sure they understand the consequences of any delay in getting the loan clear to close.

– Allow 3-4 weeks for mortgage commitments. Call your lender to gauge market conditions up front so that proper expectations can be established.

– Be sure to allow additional time for more complicated transactions. Staying in close communication with the lender will set a proper time frame for the specific transaction.

This is the time for all of us to step up and work together. We can get through this new approach and our consumers will be more educated and satisfied they are getting the loan they want.

Next Up:

TRID has new guidance to consumers on how to shop for a mortgage, which could impact the timing of the transaction. There are also new approaches to pre-qualifications that we will address in our next post. Stay tuned!
Amy Tierce
Regional Vice President

We’re here to help you and your buyers do more, learn more and grow more!

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Reduce – Reuse – Recycle For business success!

Reduce
If you are like me, you have a long list of goals to accomplish. One way to achieve this reduction goal is to Reduce the list down to one or two goals, plans or desires. Keep it simple and manageable. Focus your energy on achieving a single goal and see what happens. When you reduce a sauce, it becomes rich and refined. Do the same for your goals and see the richness it can bring to your life!

Reuse
We are a consumer-based society constantly bombarded with new and improved items to buy and products or services to engage. Everything is available in a “newer” model, and often just days or weeks after we have purchased, the “next big thing” is announced!

Take stock of what has worked for you in the past, whether it be a sales strategy or a weight loss program. You don’t need to reinvent your approach. Rather, learn to recognize the products, programs or services that support your desires and goals and look at how you can enhance or utilize those more effectively.

Don’t discard what’s been tried and true for the next shiny, new option. Invest in Reusing effective strategies for your everyday life and business.

Recycle
In business, we are often looking to develop new relationships and expand our networks with potential customers or business partners. This could be new friends, a new gym buddy or tennis partner.

Dig out that Rolodex and look at who you already know, who have you lost touch with, who would you love to see again and reach out. We are frequently looking to build new relationships when we already know people who can enrich and enhance our lives.

It can take 8 – 12 touches just to start a new relationship. It takes just one phone call to reconnect with someone. Recycle those friendships, whether personal or professional. Replacing them takes much more work!

Reduce – Reuse – Recycle to save time, energy and money and see your life simplified and enriched!

Amy Tierce
Regional Vice President

We’re here to help you and your buyers do more, learn more and grow more!

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Wintrust Advisor – Solar Panels Are Everywhere

Solar Panels Are Everywhere. How do they impact mortgage financing?

It’s April and in honor of Earth Day we are going to have an environmental focus on our next few installments!

I was out and about last week and in just few blocks sighted 6 homes in our neighborhood with solar panels. As the daughter of an early environmentalist, seeing so many houses with solar power supplementation excited me. As a mortgage professional I wondered how having solar power might impact the mortgage qualification process.

According to www.CostofSolar.com, updating your home to solar panels as your home’s energy source can save a homeowner on average $20,000 over the course of 20 years. “Residents in some states with high electricity prices can expect to save much more than that – consider Hawaii, where residents save on average $64,000 after 20 years.”

While further researching this topic, I found there are mortgage rules surrounding solar panels to keep in mind when investing in alternative energy production.

The biggest question to remember when thinking about updating your home to a solar panel system: does the homeowner own the solar panels or is the equipment leased or being paid for under an agreement with the solar company?

If you own your solar equipment you should be fine to sell your home later at any time. Complications can arise when you do not own the equipment. I would suggest that if you consider installing solar power, have a lender review the contract to determine if there could be any issues with future financing. Leasing solar panels can make an impact should you decide to sell your home at a later date.

Complications that can arise with leased solar equipment:
• The solar panels may not be included in the appraised value of the property
• The buyer may have to qualify with the solar lease payment included in their ratio
• Traditional electrical services to the house must be maintained and functional
• There are insurance requirements, and other issues to address that make financing a property with leased solar equipment more challenging

Agents, if you are listing a property with solar power, call me early on to determine any possible complications to a future buyer. Some solar providers have created contracts and lease agreements that are suitable to lending requirements, but you want to know what you are dealing with out of the gate. Here is an article on this subject from the LA Times that you might find interesting.
http://www.latimes.com/business/realestate/la-fi-harney-20150322-story.html?track=rss
On another note:
Realtors in this busy spring market if you have a favorite loan originator who you think would enjoy the Wintrust platform, send them our way!

Amy Tierce
Regional Vice President
We’re here to help you and your buyers do more, learn more and grow more!

Wintrust Mortgage is a division of Barrington Bank & Trust Company, N.A., a Wintrust Community Bank NMLS# 449042. Copyright © 2015 Wintrust Mortgage KO15031397

 

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