The closing process will significantly change when the Consumer Financial Protection Bureau's fine rule for integrated mortgage disclosures goes into effect. The rule integrates forms required under the Truth-in-Lending Act (TILA) and Real Estate Settlement and Procedures Act (RESPA). A Loan Estimate will replace the current Good Faith Estimate and early TIL disclosure, while a Closing Disclosure will replace the HUD-1 and final TIL disclosure.
The CFPB announced a proposal to push back implementation until Oct. 3, 2015.
ALTA's Land Title Institute has created a training DVD to help you prepare for the disclosures. The DVD includes six modules that will help you understand the disclosures, including an introduction, what led to the development of the new disclosures, a step-by-step explanation of the Loan Estimate and Closing Disclosure, a discussion on how business processes will change, walk through how business relationships will change and how data will be shared, and additional resources and next steps.
A customizable model presentation also is available to guide discussions with your customers.
Purchase a recording of the TILA-RESPA Integrated Forum held in Dallas. The more than seven hours of discussion provides the latest interpretations and rules on the TILA-RESPA integration from the CFPB, addresses implications for closing/settlement, provides information on completing the Loan Estimate and Closing Disclosure, highlights how technology can be used to collaborate and solve compliance issues and explains how the entire real estate transaction will be changed.
Additional Documents and Resources
ALTA Settlement Statement
ALTA developed standardized ALTA Settlement Statements for title insurance and settlement companies to use to itemize all the fees and charges that both the homebuyer and seller must pay during the settlement process of a housing transaction. Four versions of the ALTA Settlement Statement are available. Download here.
Freddie Mac and Fannie Mae have released a common industry dataset, called the Uniform Closing Dataset, which leverages and maps to Mortgage Industry Standards Maintenance Organization (MISMO) data standards, to support implementation of the TILA-RESPA Closing Disclosure form.
If you want to report a possible violation of the Real Estate Settlement and Procedures Act (RESPA), email email@example.com. Include any evidence and contact information so that investigators may contact you. To the extent consistent with law enforcement needs, the Bureau will not disclose your identity and will maintain confidentiality as permitted by federal laws.
News on the Consumer Financial Protection Bureau
August 27, 2015
RESPA Compliance When Using the CFPB Homebuyer Toolkit
The Consumer Financial Protection Bureau (CFPB) recently provided scenarios to help explain how companies can use the bureau’s “Your Home Loan Toolkit,” which guides consumers through the process of shopping for a mortgage and buying a house. There has been industry concern that providing the toolkit to business partners would violate Section 8 of RESPA
August 25, 2015
Flat Rate Recording Fees Beginning To Gain Traction
Earlier this year, Arizona passed Senate Bill 1218 to become the 11th state or jurisdiction in the country to enact flat rate fees for recording of real estate documents. Adoption of flat recording fees will help simplify compliance with the Consumer Financial Protection Bureau’s (CFPB) integrated disclosures rule that goes into effect on Oct. 3, 2015.
August 24, 2015
ALTA Webinar: TRID Ready? This Is What It Looks Like Register for ALTA’s free Title Topics webinar, which will be held from 2:00-3:00 p.m. EDT on Aug. 27, to learn how others have prepared as we provide perspectives from lenders, title/settlement agents and technology experts. To help you get ready for Oct. 3, the webinar also will address what your real estate partners and consumers should know about the new closing process.
August 20, 2015
Key TRID Items to Discuss With Real Estate Agents Listen to a portion of ALTA's TRID Townhall as Board members provide advice on key messages title professionals should discuss with real estate agents regarding the TILA-RESPA Integrated Disclosures. Because TRID requires different timelines, it's important for real estate agents to understand the need to build more time into contracts.
August 20, 2015
CFPB Details TRID Compliance Focus in Exam Manuals Among other things, the CFPB noted that during compliance examinations it will review accuracy of fees charged, the proper description, labeling and ordering requirements of fees, any affiliated business arrangements with settlement service providers, and examine how escrow funds are handled and accounts are maintained.
August 20, 2015
Standardization of Fee Names Essential for TRID In addition to preparing for new timing requirements and tighter fee tolerances, settlement agents and lenders must develop standardized fee names or descriptions for the Loan Estimate and Closing Disclosure. Because the Consumer Financial Protection Bureau wants consumers to be able to compare fee estimates with what’s actually charged at consummation, the TILA-RESPA Integrated Disclosures rule requires fee terminology to be consistent between the two forms. Make sure you are communicating with your lender to ensure fee names are consistent on both forms.
August 20, 2015
How to Disclose Survey Fees on TRID
The proper placement and naming convention for a survey related charge is one of the most complex in the new TILA-RESPA Integrated Disclosures (TRID) rule. Lenders and settlement agents should work closely together to understand the reason a survey is being ordered to ensure its proper placement on the new disclosures. Check out ALTA's blog for examples of different circumstances and how they could impact the placement of the survey charge.
August 20, 2015
First American Updates PredProtect for TRID
First American Financial Corp.’s Mortgage Solutions Group launched new PredProtect enhancements and schema, along with the availability of its testing site, developed to meet the needs of banks and mortgage lenders in complying with the TILA-RESPA Integrated Disclosures (TRID) Rule.
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