Six Lakes Realty

What Is TRID and How Will It Affect Your Chetek WI Home Purchase?

paperwork-1538658If you purchased a home after October 3 or are planning to in the near future, you may hear the term TRID popping up in regards to your mortgage. TRID, or TILA-RESPA Integrated Disclosure, is also known as the “Know Before You Owe” rule that is changing the way mortgages are done by introducing new loan forms and practices.

With TRID, there are two new forms Chetek homebuyers can expect to use— the Loan Estimate and the Closing Disclosure. Both of these new forms were created with the buyer in mind, helping them to understand the forms much easier than their previous versions. The forms clearly outline the loan amount, the terms, whether or not the amount can increase after closing and details like early payment penalties.

These two new forms allow the buyer more time to review all costs associated with their new mortgage. For instance, the Loan Estimate is to be given to the buyer three days after applying for the loan and the Closing Disclosure is to be presented three days before the closing.

Will TRID affect you?
The new TRID guidelines do not apply to Home Equity Lines of Credit (HELOCs), reverse mortgages or mortgages secured by a mobile home.

How will TRID affect your home purchase?
The good news is, with more time to review documents, you are less likely to experience any errors in your documents and thus, less likely to need to have forms re-issued. However, should corrections or additions to forms need to be made, they must be sent back to the buyer for another review and signature. This can ultimately delay your closing if the process is not managed efficiently.

How will TRID affect your lender or closing timeline?
On a similar note, delays in the closing schedule are more likely as lenders—or those preparing your mortgage documents—grow accustomed to these changes. As mentioned above, lenders must now prove that borrowers receive their Loan Estimate within three days of applying and receive their Closing Disclosure three days prior to closing. Electronic delivery makes this process easier, but for borrowers without email addresses, the process can experience hiccups as the documents must be mailed.

Keep in mind, each lender does have their own way of adapting to the new TRID procedures and in these first few months, the lending market will be working out all of the bugs associated with these industry changes.

As your real estate experts, we understand that buying a home can feel overwhelming, but we are happy to answer any questions you may have! Do not hesitate to give us a call!

John Flor
Managing Broker
Six Lakes Realty
Office: (715) 924-4806

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