Mortgage Changes October 2015! Are You Ready?

The Consumer Financial Protection Bureau rolls out the “Know Before You Owe” Program and mortgage changes in October 20015.  Real estate professionals are trusted resources for people choosing to buy a home. New rules taking effect will change your clients’ home buying experience. Since clients turn to you for help, we’re providing you with this guide to explain the Consumer Financial Protection Bureau’s (CFPB) Know Before You Owe mortgage initiative.

The Know Before You Owe mortgage initiative is designed to empower consumers with the information they need to make informed mortgage choices. It includes the implementation of the TILA-RESPA Integrated Disclosure rule, which is often referred to as “TRID.” We prefer Know Before You Owe (and since getting past jargon is a first step, we think you might prefer it too).

If you have not taken a class, or been briefed by your broker, please take the time to click on the link below and familiarize yourself with the changes in the lending process.  In brief here are the highlights:

1.  Buyers are encouraged to get several “Loan Estimates” (this a new document) from different lenders.  The form is designed to make comparison shopping easy for the Buyer and since no written documentation is required, Buyers are free to get as many as they wish.

2.  Buyers are then to select which lender they will be using and make sure to inform the selected lender of “their intent to proceed” with that lender.  At that time, all supporting documentation will be collected from the Buyer.

3.  Another new document the “Closing Disclosure” must be provided a minimum of 3 business days prior to closing for Buyer review.  From this brokers point of view this is the element that has a high potential for causing delays.  Please make sure to check with you lender and that they understand this provision of the law and have a put a system in place to make sure this document is delivered to you Buyer in a timely fashion.

Click on the link below for more information.  And let’s all make a point of working together as we all get accustomed to the new rules and documents.  I have been in this game long enough to know that the only constant is change.  Working together, we can use these new rules to provide an even higher level of service to our clients.