TRID questions
TRID Questions.
by Ryan Oda, (RA) MAT and Holly Hino-Augustin (NMLS#325967)
1) Q: First of all, What is TRID?
A: TRID stands for the TILA-RESPA Integrated Disclosure. TILA is the “Truth-In-Lending-Act” and RESPA is the “Real Estate Settlement Procedures Act of 1974.” These two Acts have governed mortgage disclosures for the past 30 years but contained conflicting and confusing language. In attempt to cure this the Dodd-Frank Wall Street Reforms directed the this “integrated disclosure.”
2) Q: What are the changes?
A: Borrowers will now receive their Closing Disclosure Statement, that breaks down all their fees, 3 days prior to signing their final mortgage loan documents. This way the borrower has a chance to review all their closing fees upfront before going to the closing table. If the borrower signs the Closing Disclosure on the 1st day it was issued, then the borrower can sign their final mortgage documents on the 3rd day. However, if the borrower doesn’t sign the Closing Disclosure Statement, it is deemed received by the 3rdday, then the additional 3 day waiting period can begin prior to signing the final mortgage documents. This could push your loan closing back by 1 week. Its best to review it right away and sign it as soon as possible trigger the 3 day waiting period.
3) Q: How does this affect the consumer?
A: It can affect consumers interest rate lock and ultimately the fees involved to close the loan. There is a lock deadline on every locked interest rate and if that deadline isn’t met then fees to extend the rate will be enforced and depending on the circumstance it can become a borrowers charge. It can also effect the final closing date. It will take more time to close loans, so consumers as well as realtors need to be aware of this.
4) Q: What can the consumer do to prevent delays?
A: The consumer needs to be available and make their mortgage loan a priority by getting in all their documents to the lender in a timely manner, and keeping in close communication with the loan officer throughout the transaction. Once again, reviewing and signing your disclosures as soon as you get them rather than putting it aside is the best thing a consumer can do.
