Hello, and welcome back to another episode of ATG TV! Today, we’ll cover some of the changes that have gone into effect in the lending world over the past couple years. 
 

Back in 2010, congress passed a bill called the Dodd-Frank Act as a response to the crash of the real estate market in 2008. Two main things came out of this legislation:

  • The ability to repay: This went into effect January 2014, and stipulates that the lender must ensure homeowners have their finances in order before determining whether they are eligible for a loan. If there is any future default on a loan, the burden of proof is on the lender to show they did everything in their power to ensure they were lending to someone who could afford it. 
  • Qualified mortgage: This stipulates that conventional loans need to meet certain parameters before they can be considered a qualified mortgage. The stipulations are that the lender cannot charge more than 3% of the closing cost on the loan, that they cannot sell any more risky loans, and that the loan must be 30 years or less. The debt-to-income ratio can now be no more than 43% of the borrower’s income.
  • An additional change you can expect to see is the new HUD-1: The lender has to provide the loan estimate and the closing disclosure, which replaced the good-faith estimate, three business days prior to closing. The lender is also required to have a proof of delivery, which can be tricky.
It’s very important for all of you Realtors out there to ensure your contracts are written 30-45 days out to give your lender time to get the loan approved while complying with all the new changes. Staying on top of these changes will ensure you can serve your clients to the best of your ability, and it will help you stay on the ball in future transactions.
 
As always, give me a call or shoot me a quick email if you have any questions! 
This power point presentation goes over background and details of rules affecting TRID, RESA/TILA, New Closing Disclosure & Loan Estimate, and the New Integrated Mortgage Disclosure Rules, that will be imposed by CFPB (Consumer Finance Protection Bureau) October 1st 2015.
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This is a snapshot poster with all you need to know about TRID, RESA/TILA, New Closing Disclosure & Loan Estimate, and the New Integrated Mortgage Disclosure Rules, that will be imposed by CFPB (Consumer Finance Protection Bureau) August 1st 2015.
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This is a snapshot poster explaining the timeline affecting TRID, RESA/TILA, New Closing Disclosure & Loan Estimate, and the New Integrated Mortgage Disclosure Rules, that will be imposed by CFPB (Consumer Finance Protection Bureau) August 1st 2015.
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This is a poster explaining the 3 day rule affecting TRID, RESA/TILA, New Closing Disclosure & Loan Estimate, and the New Integrated Mortgage Disclosure Rules, that will be imposed by CFPB (Consumer Finance Protection Bureau) August 1st 2015.
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Hello, and welcome to another episode of ATG TV! Today, we discuss  one of the biggest changes to the title and mortgage industry: the new HUD-1 statement. 
Starting August 1 there will be a few new documents, the Loan Estimate – which is replacing the old Truth-in-Lending Disclosure and Good-Faith Estimate – and a Closing Disclosure, which is replacing the HUD-1 Settlement Statement.

 
The Loan Estimate gives us a snapshot of the transaction at the beginning of the process: the loan amount, interest rates, and projected payments. The first page contains basic information, while the second breaks the numbers down into further detail, like title, mortgage fees, and transfer taxes. Finally, the third page replaces the old Truth-in-Lending Disclosure. It covers APR, interest rates, and the cost of the loan.
On the first page of the Closing Disclosure you’ll find a snapshot of the transaction once it’s taken place. You’ll find loan details, loan terms, projected payments, and cash to close. It essentially gives a brief overview of affordability costs. On the second page, you’ll find a more detailed analysis that has a breakdown of settlement charges much like the HUD-1. On the third page, which replaces the first page of the old HUD-1 one (confusing, I know), you’ll find Calculating Cash to Close and a Summaries of Transaction. Starting on August 1, Truth-in-Lending and Good-Faith will no longer be separate. They will all be a part of the Closing Disclosure. One of the new components to this document is the inclusion of the contact information of every party in the transaction – including the lender and real estate broker, among others.
We’re excited about the changes to HUD-1 because they are transparent and simplistic. It makes it clearer to the consumer where their money is going when it comes to closing costs, which is a good thing for everyone involved. If you have any questions about these changes, or if you would like our assistance, don’t hesitate to give us a call or shoot us an email. We would love to hear from you!

Because the Dodd-Frank Act of 2010 mandates the combination of the Truth in Lending Act (TILA) loan disclosures with the Real Estate Settlement Procedures Act (RESPA) Good Faith Estimate and HUD-1 Settlement Statement disclosures.

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This is a glossary explaining all terms related to TRID, RESA/TILA, New Closing Disclosure & Loan Estimate, and the New Integrated Mortgage Disclosure Rules, that will be imposed by CFPB (Consumer Finance Protection Bureau) August 1st 2015.
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