Thursday, May 7, 2015

TRID Effective Date is Less Than 100 Days Away—Are You Ready?

NEW!!! LOAN ESTIMATE AND CLOSING DISCLOSURE 

Closing Disclosure - (Goodbye GFE, TIL, HUD and Fee Sheet.

Mortgages are complex transactions that may include risky features. Consumers currently receive different, but overlapping, federal disclosure forms with the terms and costs of mortgage loans. Because these forms are confusing for consumers, Congress directed us to create new forms. We want you to use the new forms to inform yourself as you consider different loans. 

From May of 2009 to August 2015 home loan applicants would get a 3 page GFE with a fourth page showing the list of third party vendors plus a two page TIL. Come August, you will get a 3 page Loan Estimate (LE) instead. So 2 different types of disclosures totaling 6 pages condensed into 1 disclosure containing 3 pages. 

BEFORE

Current: Initial TIL disclosure + Good Faith Estimate

New: Loan Estimate

Loan Estimate page 1Loan Estimate page 2Loan Estimate page 3
Before closing the loan, you would get another 2 to 4 page TIL and a 3 to 4 page HUD. Come August, you will only get 1 disclosure, Closing Disclosure totaling 5 pages. The main benefit will be that the new CD is in the same format as the first disclosure you received called the LE. So before you needed to know how to read 4 disclosures that could be as many as 14 pages and as of August you will only need to understand 1 disclosures, no more than 5 pages.

BEFORE

Current: Final TIL disclosure + HUD-1 Settlement Statement