TRID rules apply to MOST consumer credit transactions secured by real property. These include mortgages, refinancing, construction-only loans closed-end home-equity loans, and loans secured by vacant land or by 25 or more acres.
The rule does NOT apply to Home Equity Line of Credit transactions reverse mortgages mortgages secured by a mobile home or other dwelling that is not attached to real property.
Also, TRID rules do NOT apply to loans made by a person or business that makes 5 or fewer mortgages in a calendar year.
Federal “disclosure” forms define the information that creditor businesses MUST provide to consumers applying for real estate loans.
As of Oct 1, 2015 lenders must provide TWO New “TRID” disclosure forms. for the most common kinds of real estate loans First, the Loan Estimate, which covers the key features, costs and risks of a mortgage loan.
For an approved loan this must be returned to the consumer within 3 business days of loan application. If the loan goes forward, the Closing Disclosure form, covering key transaction costs, must be delivered at least 3 business days before loan consummation.
Florida Agency Network is giving you one more reason to attend the 2015 Florida Realtors® Convention and Trade Expo! There are 36 reasons to attend.
The number one reason is to get up to date on everything TRID before the new disclosures go into effect October 3. Stop by booth 625 - Get social with all of the agencies in the FAN network and enter to win an Apple Watch!
Source: Timeline > Consumer Financial Protection Bureau
Here’s a full timeline of how we created the Loan Estimate and Closing Disclosure forms, part of our Know Before You Owe: Mortgages project. It’s a look back at our effort to make mortgage disclosures simpler and more effective, with the input of the people who will actually use them.
You can also return to the main page to view an interactive timeline.
The new law required the CFPB to combine the Truth in Lending and Real Estate Settlement Procedures Act disclosures.
The event brought together consumer advocates, industry, marketers, and more to discuss CFPB implementation of the combined disclosures.
Starting with the legal requirements and the consumer in mind, we began sketching prototype forms for testing.
During this process, the team discussed preliminary issues and ideas about mortgage disclosures. This session set the context for the disclosures and was a starting point for their development. The team continued to develop these issues and ideas over more than a year during the development process.
We posted the first two prototype loan estimates. We asked consumers and industry to examine them and tell us what worked and what didn’t. We repeated this process for several future rounds. Over the course of the next ten months, people submitted more than 27,000 comments.
We sat down with consumers, lenders, and brokers to examine the first set of loan estimate prototypes to test two different graphic design approaches.
Consumers and industry participants worked with prototypes with lump sum closing costs and prototypes with itemized closing costs.
Again, we asked testing participants to work with prototypes with lump sum closing costs and itemized closing costs.
Another round of closing cost tests, as we presented participants with one disclosure that had the two-column design from previous rounds and another that used new graphic presentations of the costs.
In this round, we presented closing costs in the itemized format and worked on a table that shows how payments change over time.
We began testing closing disclosures. Both designs included HUD-1-style numbering for closing details, but two different ways of presenting other costs and Truth in Lending information.
One form continued to use the HUD-1 style numbered closing cost details; the other was formatted more like the Loan Estimate, carrying over the Cash to Close table and no line numbers.
In this round, we settled on prototypes formatted like the Loan Estimate, but one included line numbers and the other didn’t. We also began testing the Loan Estimate with the Closing Disclosure.
Prototype A
Prototype B
Prototype C
Participants reviewed one Loan Estimate and one Closing Disclosure (with line numbers) to see how well they worked together.
A panel of representatives from the CFPB, the Small Business Administration (SBA), and the Office of Management and Budget (OMB) considered the potential impact of the proposals under consideration on small businesses that will provide the mortgage disclosures.
The panel met with small businesses and asked for their feedback on the impacts of various proposals the CFPB is considering. This feedback is summarized in the panel’s report.
(Note: Link to large PDF file.)
We conducted one final round of testing to confirm that some modifications from the last round work for consumers.
Prototype A
Prototype B
Prototype C
The CFPB released a Notice of Proposed Rulemaking. The notice proposed a new rule to implement the combined mortgage disclosures and requested your comments on the proposal.
Between the public comment period and other information for the record, the CFPB reviewed nearly 3,000 comments. These comments helped us improve the disclosures and the final rule.
We conducted qualitative consumer testing on Spanish language versions of the proposed disclosures. We tested in three cities: Arlington, Va. (October 11-12); Phoenix, Az. (November 14-15); and Miami, Fla. (December 12-13).
With the help of Kleimann Communication Group, the contractor who helped us throughout the testing process, we conducted a quantitative study of the new forms with 858 consumers in 20 locations across the country. By nearly every measure, the study showed that the new forms offer a statistically significant improvement over the existing forms.
In response to comments, we developed and tested different versions of the disclosures for refinance loans, which we tested for three rounds. (In our last round, we tested a modification for both purchases and refinances.) We also did one more round of Spanish language testing for the refinance versions. The modified disclosures tested well and are the ones included in the final rule.
The CFPB issues a Final Rule. The final rule creates new integrated mortgage disclosures and details the requirements for using them. The rule is effective for mortgage applications received starting August 1, 2015.
The CFPB issues a final rule moving the effective date to October 3, 2015.
2015 Florida Realtors® Convention & Trade Expo
Each year, the Florida Realtors® Convention & Trade Expo gathers thousands of Realtors looking to up their game. This years theme is Celebration 15; the event falls on August 19-23 and is held at the Rosen Shingle Creek in Orlando, Florida. The free two-day Expo is on Thursday and Friday--all you have to do is register. There are over 30 education sessions sorted into six learning tracks--technology, broker, productivity, trends, personal growth, and continuing education. Along with the Convention, the Trade Expo has over 200 exhibitors that come packed with promotional materials and exquisite raffle prizes. This years keynote speaker is Notre Dame's former Head Coach Lou Holtz.
On October 3, 2015 the TILA-RESPA Integrated Disclosure (TRID) rule will go into effect. The Florida Agency Network (FAN) is leading the industry through uncharted waters to the new disclosures. Title agencies in the FAN network are prepped and ready to keep you afloat before, during, and after these industry changes. Join us at booth 625 as we say Bon Voyage to the HUD-1 and celebrate the implementation of the new Closing Disclosure (CD). Get social with us and enter to win an Apple iWatch!
The TILA-RESPA rule (TRID)-- is meant to make the disclosure documents used during a transaction more consumer friendly and to move the industry towards a paperless transaction. The rule combines the current four disclosures. Check out the CFPB's break down below:
Don't recognize the new Jargon? Here is a handy chart to help with the transition:
To find more specifics visit:
The industry's much anticipated delay to implement the TILA-RESPA Integrated Disclosure (TRID) was announced last week. The new regulation had the initial launch date set to be August 1, 2015 but has now been pushed back later this year to October 1.
The Consumer Financial Protection Bureau's Director, Richard Cordray stated, "We made this decision to correct an administrative error that we just discovered in meeting the requirements under federal law, which would have delayed the effective date of the rule by two weeks." Whatever the reason the industry as a whole seems to have let out a huge sigh of relief.
These new documents are meant to be more consumer friendly by consolidating the TILA-RESPA forms and making them easier to understand. The new regulations give the consumer more time to review the total costs of their mortgage and to ask any questions they may have in regards to their loan terms. The Loan Estimate is due to consumers three days after they apply for a loan, and the Closing Disclosure is due three days before closing. These two requirements along with software compliance and security issues have thrown the industry into a frenzy as they try to comply by the deadline.
The best thing you can do to prepare yourself is to join the conversation. In an ever changing industry it is important to partner up with a title agency that has aligned and complied with the new regulations. Agencies powered by the Florida Agency Network (FAN) are prepped and ready to lead the way during this immense industry change. Tuesday, June 23, 2015 will mark the 100 day countdown until the CFPB's implementation of the TRID.
It's going down -- 10.01.15 -- Stick around for our countdown!
Please Note: Since posting the CFPB has submitted an amendment to their proposal further delaying the effective date to October 3.
Due to lack of preparedness in the industry, CFPB has delayed implementation of the TILA-RESPA Integrated Disclosure (TRID).
It's important to partner up with a title agency that is ready for the up coming industry changes. Title agencies powered by the Florida Agency Network are compliant, trained and ready to take on these industry changes.
It's going down on Oct. 1, stick around for our countdown!
Find out more about partnering up with a title agency powered by the the network : Max Jackson at max@FLagency.net
Please Note: Since posting, the CFPB has submitted an amendment to their proposal further delaying the effective date to October 3.
Excerpted from Bank of America memo to Settlement Industry
CFPB Integrated Mortgage Disclosures – The Closing Disclosure & Closing Insight™
To: Settlement Agents
Bank of America continues to prepare for the Consumer Financial Protection Bureau’s (CFPB) Integrated Mortgage Disclosures rule under the Real Estate Settlement Procedures Act (Regulation X) and the Truth In Lending Act (Regulation Z) that go into effect August 1, 2015. With less than a year before the implementation date, we have started to share information with the settlement agent community about the rule and will now begin to share how the rule will change the way you work with us.
Bank of America will use Closing Insight™, an industry tool developed by RealEC® Technologies, to support the implementation of the CFPB’s Integrated Mortgage Disclosures rule.
What is changing with how you work with Bank of America?
Bank of America will continue to work through all that is needed to meet both the requirements of the regulation and continue to deliver an exquisite experience for our mutual customers. We will share more information in the coming months as it becomes available. In the meantime, please submit any questions or feedback you may have regarding how Bank of America will expect you to handle transactions after August 1, 2015 to Integrated.Disclosures.Feedback@bankofamerica.com.
For more information about RealEC® Technologies or Closing Insight™, please visit their website at www.bkfs.com/realec. In addition, many Title & Escrow production systems are working with RealEC® Technologies to enhance current integrations in support of Closing Insight™. For more information about how or if they plan to support Closing Insight™, reach out to your provider directly.
Thank you for your partnership.
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