Greetings Real Estate Professionals – As we all are well aware, TRID implementation began with loan applications dated as of October 3rd and beyond.
Hopefully you are aware of the implementation of the new TRID regulations that change the way we all practice our professions in the world of real estate sales and lending. Here is a quick primer and some TRID survival tips to consider as we all get used to this new way of approaching the mortgage process in the third quarter of 2015.
Let’s talk terms first. With the implementation of TRID, even our language is changing. Here are a few examples:
Good Faith Estimate of Closing Costs = Loan Estimate or LE
Truth in Lending Disclosure = Now part of the Loan Estimate or LE
HUD = Closing Disclosure or CD
Final Truth in Lending = Now part of the Closing Disclosure or CD
Borrower = Consumer
Lender = Creditor
Closing = Consummation
I have compiled some tips to help agents navigate through this new landscape. Hopefully these will provide guidance moving forward.
First, you want to keep an eye on apply-by dates in contracts. If there are delays in performance, extend all dates accordingly. This applies to purchase and sale date, apply by date, commitment date and consummation date.
Make sure that you allow two weeks from mortgage commitment to consummation.
As long as we are talking about closings, which we now refer to as consummations, make sure that you are staggering them. Do not have all consumers consummating at the end of the month.
It is imperative that you educate your consumers. Make sure you obtain insurance early and that you are responding to lender requests quickly.
Have your sellers make any obvious repairs prior to listing. This helps prevent any delays once we are in the commitment window.
For any potential FHA sale/listing be sure that paint and safety concerns are addressed prior to listing.
When marketing a condo – Obtain condo docs in advance including master deed, budget and bylaws, as well as, insurance provider and management company contact details. Obtain a condo questionnaire in advance, if possible.
A few simple rules to REMEMBER:
The consumer must receive the Closing Documents three business days prior to consummation. The consummation will not occur if the CD is not received within that three-business day window. There is a hardship provision but will be very difficult for a consumer to prove hardship.
The consummation (closing) will be postponed if one of the following actions occur between disclosing the CD and the consummation; the APR on the loan varies by an eighth or more, the loan program changes or there is an addition of a pre-payment penalty.
However do not fear, we can adjust figures legally, even the day of the closing, as long as the adjustments do not impact the APR. Many agents have been told that all numbers have to be exact, however, there still remains room for minor changes. This cannot be promised on behalf of all mortgage companies, each company creates their own processes based on how they interpreted the regulations.
With the implementation of TRID, the bar has been raised for mortgage and real estate professionals. To ensure happy and satisfied consumers we have to come together and work as a team and deliver a high quality experience for all. We can do it and we will. Education is the first step and continued coordination will ensure we keep exceeding our customers’ expectations.
For more TRID TIPS or TRID Training, give us a call. We will be happy to come to your office and provide additional TRID education to help us all meet the demands of the new mortgage marketplace.