As of October 3, 2015, the new TILA-RESPA Integrated Disclosures (TRID) rule is in effect. Under this rule, lenders are required to provide home buyers with a Closing Disclosure three days prior to their scheduled closing.
This disclosure is intended to give buyers time to double-check that all the details are correct and to get answers to their questions if anything appears not in keeping with what they expected. Should changes be necessary, the three days will begin again – which would delay closing and cause problems/inconveniences for all involved, most especially buyers and sellers.
With that in mind, we offer some “Do’s and don’ts” for obtaining a home loan under the new regulations:
Do: Take time to discuss and compare all of your options with your lender before choosing the loan that best suits your situation. Then make your application.
Don’t: Ask for a loan estimate on a 15 year fixed loan, then change your mind and ask for a 30-year loan a few days before closing.
Do: Fully disclose your income, assets, and liabilities to your lender before making your formal loan application.
Don’t: “Forget” to mention your child support payments or a wage garnishment in hopes that no one will notice these liabilities.
Do: Supply documentation of your income before asking him or her to prepare your Loan Estimate (LE).
Do: Include only verifiable income when asking for a LR.
Don’t: Think you can use the dollars you earned “under the table” to help you qualify for a loan.
Don’t: Wait until after the lender prepares your LE to mention that you haven’t filed Income Taxes for the past four years.
Do: Review the fees and services offered by available title companies before making your choice.
Don’t: Select a title company, then change your mind after the work has begun.
Do: Take your lender’s and agent’s advice with regard to the days required to close your loan and finalize your purchase. Understand that loans take longer to close under the new rules. This is not something your lender can control.
Don’t: Insist on a closing within seven days of your offer acceptance, just because someone on late night TV said it could be done.
Do: Give your lender current email addresses for all borrowers, then check those accounts daily.
Don’t: Furnish an outdated email address or one you check only occasionally.
Do: Carefully read your Closing Disclosure as soon as you receive it. Check for any errors and call your lender immediately if you find discrepancies or have questions.
Don’t: Fail to check your email until the day before closing, then ask your lender to re-schedule the closing because you haven’t had time to examine it.
Do: Understand that your lender MUST send you the Closing Disclosure three business days prior to closing.
Don’t: Ask him or her to make an exception for you because you have things to do and places to go three days from now. TRID is not optional for your lender.
The new regulations have been dubbed “Know before you owe” because they’re designed to ensure that borrowers know exactly what they’re agreeing to before they sign their loan documents.
For a detailed explanation and to view samples of the new Loan Estimate and Disclosures, visit the Consumer Financial Protection Bureau (http://www.consumerfinance.gov/owning-a-home/loan-estimate/)
Here at Homewood Mortgage, the Mike Clover Group, we have always provided accurate estimates and full disclosures to our borrowers, because we have always believed that our borrowers deserve to “Know before they owe.” The only thing the new TRID regulations mean for us is that we’ll be using the government-sanctioned forms and providing the disclosures 3 days prior to closings.
We’d love to help you get the right loan for your financial situation, so call us at 469.621.8484 or apply on line at www.mikeclover.com.
18170 Dallas Parkway
Dallas, TX 75287