Relationships are about to Change between Home Lender and Home Buyer
Effective October 3, 2015, as a result of the mandates imposed by Dodd-Frank, TILA RESPA Integration Disclosure goes into effect.
Home buyers will no longer see the current Good Faith Estimate, Truth-In-Lending and Servicing Disclosures. Instead, they will be receiving simplified paperwork called the Loan Estimate.
In addition, the HUD-1 Settlement Statement, and Itemization of Amount Financed Disclosures are being replaced by the Closing Disclosure.
How will this affect the consumer? We foresee communication, and timeliness of communication between lender and consumer will have the highest impact.
Lenders will be required to issue the Loan Estimate within 3 business days after receipt of loan application. Then there is a 7 business day period from date of delivery of the Loan Estimate before a closing date can be scheduled. Once the borrower has received the Loan Estimate they have 10 calendar days to send the lender an intent to proceed statement. Now, if anything is renegotiated between the buyer and seller or if there is a change in the loan program, etc., the lender has a new 3 day period to issue a new Loan Estimate. Do you see where this is going…..The days of having a loan cleared and also closing that same day, or next, are over.
Change is good. It becomes increasingly clear that the synergies of realtor, lender and client become ever more important for our clients to achieve their dream of home ownership.
Stay tuned, October 3 is fast approaching.