Mortgage applications fell drastically last week and some believe it is the direct result of the new TRID rules (Apps Decline).
Could it be that lenders were able to push many applications to the prior week due to the fears created by the need to comply with new disclosure rules? Do lenders have such powers to make buyers move up their purchases so they can get their applications in advance of such a major change? I really doubt it…
Maybe, some loan originators pushed a little to take applications from consumers who had already purchased their homes in advance of the Saturday TRID implementation date. However, I would hope that most originators would be trying to service their customers by taking applications as soon as possible after a purchase regardless of such regulatory changes. By now, I would sure hope they are prepared to comply with the new TRID rules.
Let’s face it – TRID is here to stay and there ain’t no putting it off anymore. Loan originators need to be trained and prepared to know when they have an application, what needs to be disclosed to a new applicant and when it needs to be disclosed.
Remember, in addition to the new Loan Estimate, the consumer must also receive:
- The Homeownership Counseling Organization notice
- The new “Your Home Loan Toolkit”
- Lender’s List of Service Providers (listing at least one provider for each service the borrower may need)
The Loan Estimate must accurately reflect the fees and charges a borrower may expect to pay at their closing. If it isn’t issued on time, the lender may not charge, nor collect, any fees, including fees for third party services such as the appraisal and credit. That ain’t good…
If a loan originator had an application as of the TRID effective date (10/3) and the lender has not yet issued the new Loan Estimate, you’re late. The deadline has passed. If the LE was already issued, congratulations, you’re on your way in the new TRID era.
Now, it’s time to monitor these loans to be sure you identify any changes and when the rate gets locked, so a revised disclosure may be issued on time when any fees are increased or loan terms change. That way you can collect what should be coming to you at the closing. That is good…
The next challenge; issuing the Closing Disclosure on time.
Welcome to a new era in mortgage lending. Brought to you by your friends at the CFPB.
We’re on our way, traveling the new TRIDway.