With the TILA-RESPA Integrated Disclosure (TRID) rule now in effect, we reached out to FORCE members to see how the rule is impacting real estate agents and their clients. Are closing delays the new norm, or has the transition been seamless?
The long-anticipated TRID—TILA-RESPA Integrated Disclosure—rule is now in full force. The CFPB insisted TRID would make the mortgage process simpler and easier for homeowners to understand, but apprehension resounded throughout the industry prior to its passing.
So what has been the impact thus far?
CFPB Director Richard Cordray says it’s been a success. “Reports from participants across the market seem to be indicating that implementation of the new rule is going fairly smoothly. So it seems that these anxieties were much like the errant predictions of technological disaster stemming from Y2K, which of course never materialized.”
However, Moody’s Analytics released a report stating more than 90 percent of recent residential mortgage loans had TRID violations. While admitting many of these errors were minor and technical, the full impact of these errors is yet unknown, especially as these loans make their way into the secondary market.
While title and lending professionals are certainly on the front lines with this change, real estate agents are also impacted. We reached out to a few FORCE members to see what the new rule has meant for them and their clients.
Judy Cox, Results Realty Illinois:
I haven’t experienced anything that’s not workable so far. TRID is keeping the mortgage lenders on their toes. I sort of like it because mortgage lenders have to be ready, and we know three days before closing that they have to be ready. We try to help the process by constantly asking lenders if they’re missing anything to help expedite the process. It’s very important to work with lenders who communicate. Lenders usually tell the buyer but don’t tell us what is going on. If they can keep agents more informed, that might help. Sometimes the buyers don’t understand the importance of getting paperwork in quickly. They get busy. Keeping everybody informed can help expedite the process. It’s really about everybody being ready and not waiting until the last minute.
Nell Jones, RE/MAX Fine Homes:
So far, it hasn’t bothered me. In our area, most of the sales are cash. That’s one of the pluses of doing cash—not having to deal with it. Maybe that’s not a good thing for government-backed loans though. People are going to shy away from it. I was told it would take at least 45 days with the new disclosures, but I don’t think that’s true. I haven’t seen it take that long.
Jim McPeak, McPeak Real Estate Firm, Inc.:
Since TRID went into effect, there have been a lot of delays. Everything that used to take 30 days is taking 45; everything that took 45 days is taking 60. TRID is not very user-friendly. The right hand doesn’t know what the left hand is doing. TRID is another cog in the wheel. Before, real estate agents could look at the documents and see what was going on with them. Now, you don’t have the same access to the information that you used to have.
Most of what’s happening doesn’t impact us as much as the mortgage and title companies. The process has been challenging for the mortgage companies. The lending industry has changed. The pay went down, so a lot of people got out. So now it’s a lot of new people, and it’s very hectic.
Aaron Mighty, Mighty Realty:
I think the biggest impact is that it may take an extra three to five days to close a transaction. But we’ve planned ahead to educate agents. We had lunch-and-learns to explain the changes from final HUD to new TRID. The biggest thing is getting everyone educated and managing that process accordingly so it doesn’t take 10 or 15 days longer to close. At best, we are closing in same amount of time as before.