Attention all buyers and sellers!  The new TRID, TILA-RESPA Integrated Disclosure rule goes into effect on August 1, 2015.  It is very important to understand what this rule is and what kind of impact it will have on escrows and closing on time!   On August 1^st, 2015 the Loan Estimate replaces the GFE and early TIL, and the Closing Disclosure replaces the final TIL and HUD-1.  What does this mean to me? It could mean longer closes of escrow, so our days of short closes might be ending. What is TRID? The Closing Disclosure, which replaces the final TIL and HUD-1, must be received by the consumer at least three business days prior to loan consummation.  Consummation is the point in time when a consumer becomes contractually obligated by State law.  In California, it is when the borrower signs the Note.

The revised Closing Disclosure is required when there are three kinds of changes during a transaction.  If there are changes made to the APR, or a prepayment penalty is being added or the Loan Product is changed, then prior to loan consummation, there must be an additional three business day waiting period will apply.

This new rule may appear benign, however, I know from my experiences that many times loan amounts may change, rates may need to be extended, credits are added late in the game that may affect APR, and so on…The list goes on regarding all the possible changes that can and do occur during a purchase transaction that may cause delays by the new TRID rule.  My biggest recommendation is to plan accordingly and know that there may be more requests for extensions coming up in the near future.

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