The new mortgage rules known as TRID (TILA-RESPA Integrated Disclosure) are here and we can say with certainty and — from experience — it is possible to close loans as quickly as ever.
Last month the massive, sweeping regulations known as TRID went into effect. For months leading up to their implementation, industry executives worried the new rules would lengthen – not to mention, further complicate – the home closing process. Predictions were that it would now take an average of 45 days to close, compared to the previous industry standard of 30 days.
The Atlanta office of our company, Movement Mortgage, just closed our first TRID loan in 14 days from application – nine days from submission of the loan. The loan officer team of Todd Cosper and Joseph Miller handled the mortgage.
As it turns out, far from complicating the process, TRID actually reduces the standard number of documents associated with doing a mortgage and leads to more transparency. No more showing up to the table the day of closing with surprises.
Under TRID, we still close loans fast and we have not had to make any changes to our six-hour underwrite and seven-day processing model.
How did we do it? For starters, our company saw the “writing on the wall” and began hiring additional staff as soon as it heard the changes were coming, assuring the new TRID disclosures would get out on time.
There are also several things buyers can do to help facilitate an efficient, timely closing process. We offer these tips:
1. E-sign: If you feel comfortable and your lender allows it, e-signing loan disclosures saves several days in the process.
2. Do your homework now: Do your research upfront on loan products and programs. It will be harder than before to change products mid-stream.
3. Lock-in interest rates: The earlier that you lock-in your interest rate the better.
4. Review TRID preparation: Ask your lender before you start the process if they are ready for the TRID changes and how long they need to close the loan. It need not take longer than the previous industry standard of 30 days.
5. Make decisions as early as possible: Make your decisions — such as which title company to use, which insurance agent to use and when to lock-in rates — as early in the process as you feel comfortable.
The good news is that by asking the right questions as far in advance as possible and assembling a solid team, TRID can make for a best-ever closing experience. That’s because TRID actually reduces the standard number of documents associated with doing a mortgage.
The traditional Good Faith Estimate (GFE) and the initial Truth in Lending disclosure have been combined into one document called the Loan Estimate (LE). The HUD1 and the final Truth in Lending disclosure are now combined to make the Closing Disclosure (CD).
In conjunction with providing this Closing Disclosure three days prior to closing, the two new documents, the LE and CD, are required to have little change during the mortgage process which leads to more industry transparency and honesty.
This is really how it should have been all along.
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