Understanding TRID & What It Means For You
Changes are coming to the way home mortgages close and the our team recently set down with mortgage professionals from CresCom Bank to gain a full understanding of the new rules, known as TRID, and how this will affect their clients. The initiative of the Consumer Financial Protection Bureau (CFPB) has also been dubbed 'The Know Before You Owe' mortgage disclosure and was developed in order to simplify the loan closing process for borrowers.
What This Means To You
While your Realtor is the best source of information for how the new rules will specifically affect your closing process, we've outlined a few basic things to know in order to provide a basic understanding of the disclosures and what to expect:
- TRID will become effective for all applications dated October 3, 2015 and after.
- Currently there are four (4) disclosure forms which will be replaced with with two (2) new ones: the Loan Estimate and the Closing Disclosure. These forms have been re-designed with the help of industry professionals to combine duplicate information as well as simplify complicated terms.
- You will now have a mandated three (3) business days to review your closing disclosure before you can close on a mortgage. This will cause closing dates to be extended from the normal 30 day to 45 or more depending on the situation.
Overall the goal of the CFPB's new disclosure is to provide consumers with access to information that is easy to review and to allow adequate time for a full understanding. This initiative stems from the housing crisis faced by many homeowners in recent years. By making the disclosures easier to comprehend and ensuring time for lenders to explain the terms thoroughly, the end result will be homeowners who have a full understanding of mortgage terms, who can avoid entering into financial agreements that they are unable to maintain.
If you are interested in learning more about new mortgage rules such as TRID, contact one of our agents today for more information!