Some of you may have already heard about the new consumer protections called “TRID”, which stands for this mouth-full; “TILA (for Truth In Lending Act), RESPA (for Real Estate Settlement Procedures Act), Integrated, Disclosures. Yup, congress, through the Consumer Financial Protection Bureau, has once again taken consumer concerns (or acted on their own to look good), and came up with new laws to turn your world upside down.
Effective today, Big changes take effect in all residential real estate transactions involving mortgages (purchase and refinances). Commercial, cash and other transactions types are not affected (evidently they are smarter & can protect themselves). This could extend the current 30 day escrow, to 60 days (although, after everyone gets grasp on all the new disclosures & timelines, could settle in around 45 days). These new government mandates, although designed to protect buyers/borrowers, will effect Sellers & almost every other entity in real estate transactions from now on.
The current “Good Faith Estimate” will be replaced by a “Loan Estimate”, which will be received within 3 days of applying for a loan. The “Closing Disclosure” must be received by the borrower 3 business days before the closing. If this disclosure is mailed, couriered or emailed, they must add another 3 business days. This is a huge change, because today, some necessary information is still being gathered (changing signing documents) 1-2 days before closings. To accomplish these new mandates buyers & agents will need to get lenders EVERYTHING they need 10 days before the closing…Rush or Last-Minute Closings will No Longer be Possible. Realistically, buyers & sellers may need to add 3-4 weeks to closings, to accomplish everything needed.
Trying to close by the end of the month (to save on interest)? You must get all documents to your lender by early to mid-month, especially if you want to ask questions. In February that means immediately after the Super Bowl.
Real Estate Purchase contracts have also been changed. So make sure you agents knows them, and knows how to still get your transaction closed in a timely matter. Scott Stephens is a Real Estate Trainer, keeping not only himself, but also his fellow agents up-to-date on all new changes. Additionally, he uses a lender, “United American Mortgage Company” who GUARANTEES they can still close purchases in 30 days*. Whether you are a Buyer or Seller you’ll want to Call Scott, Keller Williams Realty, for advise (714) 801-6230 or Phil Andrews, of UAMC (714) 287-6148 (sellers can require buyers to apply with Phil, although they can’t require that they use him, providing confidence they can close on time). No Hablo Ingles…Jessica McClure (714) 713-0172.