The Consumer Financial Protection Bureau (CFPB) is responsible for making rules that apply to the mortgage loan process. Tila Respa Integrated Disclosures (TRID) refers to new rules meant to protect you as a consumer. These new rules will go into effect on October 3, 2015.
When going through the mortgage loan process, clients often receive their final numbers at the last minute and feel pressured to sign without fully understanding multiple documents that explain their loan terms and costs. With TRID, you will now receive a Closing Disclosure at least three days before the closing. This disclosure replaces the Housing Urban Development (HUD-1) and final Truth in Lending (TIL) documents. It also will provide key details about loan terms, estimated costs and cash needed to close in a single document. Once received, you will have three (3) days to review your Closing Disclosure which will assist in empowering and better preparing you to close with confidence.
Within three (3) days after your application, you will be sent a Loan Estimate, which will show a consolidated snapshot of your loan terms and estimated fees. You will review the Loan Estimate and notify your lender of your intent to proceed with the loan. Lenders will typically start processing the loan after receiving this intent to proceed and any upfront fees. Lenders can void the Loan Estimate if this intent to proceed is not submitted within ten days. At the end of the loan process, at least three days before closing, you will receive a Closing Disclosure document from your lender. This document will replace TIL and HUD1. This new document is straightforward, making it easier for you to compare figures in the Closing Disclosure to those in the Loan Estimate. The Closing Disclosure shows the actual terms and costs of the loan, and exactly how much money is needed for the closing.
There may be changes during the mortgage loan process that may require revisions to the Closing Disclosure. A simple revision may not delay the closing, but if the change is significant (i.e. increase in APR, changes to the loan product, addition of prepayment penalty), then a revised Closing Disclosure and a new three (3) day waiting period will be required. A dedicated Mortgage Loan Specialist will provide home buyers with details throughout the mortgage loan process.
Your loan officer and title company will work together to do their part in helping you close on-time. Here are a few tips for how you may help the financing process: Collect income and asset documentation Consult a loan officer to evaluate loan options Sign up for electronic disclosures from lender Review Loan Estimate Submit intent to proceed and any initial fees to the lender Get all requested documents to lender within 24-48 hours of request Immediately inform loan officer if you need to change your loan terms
Your loan officer, real estate agent and title company will work together to do their part in helping you close on-time. Here are a few tips for how you may help the financing process before you sign the purchase agreement: Collect income and asset documentation Consult a loan officer to evaluate loan options Sign up for electronic disclosures from lender Secure a pre-qualification(1) or pre-approval (2) Shop for home insurance and home inspection Here are a few tips for how you may help the financing process after you sign the purchase agreement: Get the home inspection done as soon as the purchase agreement allows Set a realistic and firm closing date Shop for homeowners insurance Submit purchase agreement and all addendums to loan officer as soon as possible Submit updated income and asset documentation Review Loan Estimate Submit intent to proceed and any initial fees to the lender Get all requested documents to lender within 24-48 hours of request Immediately inform loan officer of any changes to the purchase agreement