Sellers Need to Know – TRID

Back on October 3rd the Consumer’s Financial Protection Bureau tightened up and changed regulations in hopes of providing buyers with greater understanding of costs when purchasing real estate. The “Know Before you Owe” mortgage initiative puts stricter regulations on mortgage lenders, title companies and closing attorney’s.

What does this mean for sellers?

  1. Closing timelines could potentially be impacted and extended. Many lenders are estimating closing timelines between 45-60 days or possibly more. At one point the New Hampshire Association of Realtors released a video stating that closing timelines could be more like 85 days but we have not experienced that yet. Many factors impact the process of a loan including how complicated a buyer’s financials are, turn around time on appraisals, and how quickly the buyer provides the lender necessary documents.
  2. The HUD-1 settlement statement is now called the Closing Disclosure or CD.
  3. Lenders are required to have closing disclosure to buyers 3 business days prior to closing.
  4. Realtors are no longer receiving the Closing Disclosure prior to closing. Since October 3rd, I have not had one closing that required lender financing in which I have been provided Closing Disclosures ahead of time. This means if there are issues or errors on the Closing Disclosure sellers must first reach out to the title company or closing attorney for clarification.
  5. Fuel prorations will be done a minimum of 10 days prior to closing.
  6. NO funds are to be transferred outside of closing. This has been an inhibitor to business and I suspect will change at some point because of the frequent furniture and personal property items that are sold with real estate. There are lots of conversations and situations that can play out around this topic.

These are just a few of the main points sells need to know about TRID and how it is impacting real estate transactions in today’s marketplace. The changes are really for the benefit of consumers and I believe them to be a good thing, they just take some time to get used to. Having an agent to represent you who is up to date on changes in regulations and how the regulations are impacting business is critical to your success and making the selling process less stressful.