BIG CHANGES in REAL ESTATE that may AFFECT YOUR Real Estate closing!

BIG CHANGES in REAL ESTATE that may AFFECT YOUR Real Estate closing

GOOD BYE…old HUD-1 and closing statements.

Starting August 1, 2015, any transaction involving a mortgage will use the new disclosure forms created by the Consumer Financial Protection Bureau (“CFPB”). The Truth-in-Lending Act/RESPA Integrated Disclosures (“TRID”) creates timing requirements for disclosures that lenders need to make to consumers. 

What should YOU expect?

·      New closing disclosures forms and loan estimates.

·      The consumer (buyer) must receive the new Closing Disclosures must be received within three business days of closing.

·      CHANGES will require a new Closing Disclosures and another three-day waiting period. For example… APR changes, loan product changes, delayed inspection of repair, final inspections on new homes, additional documents and host of others items can trigger a 3 day delay.

·      Prepare that closings time frame will be longer. They are recommending adding additional 15 days to “normal” closing time frame when a loan is involved.

As REALTORS, we will be learning how to navigate this change to best educate and guide our clients.  It’s apparent that being timely in all facets of the contract process is a must.  Buyers need to provide lenders the information requested as soon as possible and sellers need complete any agreed upon inspection reports or repairs well advance of the closing.  For example; CL100 Wood/Pest Report, repairs required, Certificate of Occupancy and final loan inspections for builders.

Summary… having “all ready and in” place 7 days in advance of the closing date would be the best goal.   This would give time just in case a 3 day waiting period is triggered for any reason.