New Mortgage Loan Changes Coming in August

Homeownership is a rewarding and life-changing experience. For those who have purchased a home and have gone through the loan process, you may recall the seemingly-endless forms.  Regulators are moving to make it easier for consumers to understand the complex, financial aspects of the loan.

Beginning August 1, 2015, changes are coming to the mortgage lending process. These changes (TILA and RESPA), which Academy Mortgage is referring to as “TRID”, include two integrated disclosures:  the Loan Estimate (LE) and the Closing Disclosure (CD).  These new disclosure forms have been extensively tested in focus groups to assure greater clarity to the consumer.  

• 1.  Loan Estimate form (LE): The mortgage industry has provided borrowers with a Good Faith Estimate (GFE) and an initial Truth-In-Lending disclosure (“early TILA”).  The GFE and “early TILA” forms will be combined into one new form, called the Loan Estimate (LE).  The purpose of combining the previous forms into the new Loan Estimate is to help borrowers better-understand key features, costs, and risks of the mortgage for which they are applying.

• 2.   Closing Disclosure form (CD):  This form will be created to combine the HUD-1 and the final Truth-In-Lending disclosure.  The new Closing Disclosure form must be provided at least 3 business days before the consummation of the loan.  Depending upon the method of delivery to the borrower, another 3 days may be required to ensure proper disclosure.  This change and others will have an impact on the industry and the timing of transaction closings.

 Have questions about the new mortgage loan changes? We can help! Click here to contact us.