New federal regulation, implemented Oct 3, 2015 is designed to slow down the process of buying a home with a mortgage so that it can be completed in a more thorough manner. In addition, new “TRID” (TILA-RESPA Integrated Disclosure) rules are an attempt to better explain closing costs to a buyer and make sure the lender does a more in-depth credit, income and asset review before allowing a buyer to close on the purchase of a home.
Sellers, what does this mean to you? Avoid delays at all costs!
- To avoid wasting a lot of time on buyers who are not qualified to buy, you might want to request they provide a letter from their lender that the lender has indeed, reviewed their income, asset and credit documentation before you entertain an offer.
- Loan closing costs will increase so you may be asked to help since this narrows the field of buyers with ready assets.
- Have a copy of your survey available for your Realtor ® to review before listing your home.
- Make your Realtor ® and title company aware if you will not be available during the selling process or at closing. This can cause major delays in closing.
- Make sure your Realtor ®and the title company know immediately of any divorce, death, bankruptcy, tax liens or lawsuits that you’ve experienced since buying the home.
- Respond to the title company immediately upon their request for payoffs, surveys or other documentation.
- Make sure all repairs, receipts, HOA documents, Powers of Attorney, etc. are completed and provided to your Realtor® and title company a minimum of 2 weeks prior to closing.
- All lenders, attorneys and title companies had to re-tool their technology in a very short period of time so initially, there will be delays simply due to systems integration errors.
- The HUD1 Settlement Statement which contained the final accounting of all numbers for both the buyer and seller, NO LONGER EXISTS. It has been replaced with a Closing Disclosure.
- Closings will take longer (expect at least 45 days). Once the loan is through underwriting, all work/bills submitted, approved by all closers and attorneys, the buyer will then receive, review and sign-off on the Closing Disclosure. Sellers must wait another 3-6 business days to actually sign any closing documents and fund. This is the buyer’s “cooling off” period to make sure he/she still wants to purchase the home.
Juli Coen, V.P. Sr. Mortgage Lender and Military Specialist
13750 San Pedro, Ste 620
San Antonio TX 78232
Reprinted by permission from Juli Coen, October 10, 2015