Q: What is TRID?
A: TRID stands for TILA RESPA Integrated Disclosures. This is a new rule from the CFPB (Consumer Financial Protection Bureau) that amends components of the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA). The new rule replaces and integrates several disclosures into two separate and distinct disclosures known as the Loan Estimate and the Closing Disclosure.
Q: Are TRID (TILA RESPA Integrated Disclosure), RESPA/TILA and KBYO (Know Before You Owe) the same thing?
A: Yes. They are all different names for the disclosure integration from the CFPB.
Q: When does TRID/KBYO start?
A: TRID is effective for files with a RESPA application date of 10/3/2015 and after. For loans with a RESPA application date prior to 10/3/2015, the existing forms will continue to be used until the loan is closed and funded.
Q: What is consummation?
A: Consummation occurs when the borrower becomes contractually obligated to the creditor on the loan (e.g. at signing, not funding).
Q: What is considered a complete application?
A: An application is received when the following 6 pieces of information are obtained (regardless of whether additional information was requested): the borrowers’ name, income, social security number, subject property address, estimated value of the subject property, and the mortgage loan amount. There are zero exceptions under the new rule.
Q: Can a lender add a 7th application trigger requiring the borrower to provide certain documentation to delay disclosing?
A: No. The new rule prohibits lenders from instituting additional triggers and requiring verifying documentation as an additional trigger before providing the disclosure package.
Q: Are there changes to pre-approval letters?
A: Yes. The following language must be clearly and conspicuously stated at the top of the 1st page of the Pre-approval Letter in a font size that is no smaller than a 12-point font: “Your actual rate, payment, and costs could be higher. Get an official Loan Estimate before choosing a loan.”
LOAN ESTIMATE QUESTIONS
Q: Is the GFE going away?
A: Yes. The GFE and TIL are being integrated into one disclosure called the Loan Estimate.
The suggested closing time frame for loans is now 60 days or more. The only way to circumvent this process is to purchase the property with "all cash."
Disclaimer: The above information is considered to be true & accurate as of this writing - the writer makes no claims or promises that each and every lender operates under these guidelines. Data has been taken from various publications regarding the above details.