Key Mortgage Services Inc.
Q: How will TRID changes lengthen the home purchase process?
A: The new documents required at the time of home-loan application and closing won’t be a problem for industry participants, but the closing process has most certainly been extended by six days, and for real estate professionals who don’t consistently work with a team of settlement service providers that they trust to perform and deliver, the delays will be longer. That’s because closing figures and the creation, distribution and management of changes to the Closing Disclosure will now all be managed by the lender, not the title company, and certainly not at the closing table.
Q: How Can Real Estate Brokers Set Client Expectations Around Timelines With These Changes?
A: Communicate with your partners. Know the lender and make sure your client meets their contractual obligations for making applications for their home loan. Changes to the terms of the real estate contract must be made with all parties’ knowledge and documented as early in the transaction as possible to avoid closing delays. Meet and get to know the attorneys involved in the transaction, and confirm they work with reputable title insurance companies that have a history of performing for clients and partners. It has never been so critical that all the parties to the transaction work together as a team to create excellent customer experiences.
Q: These Changes Are For Consumer Protection, but Will They Have a Negative Effect on the Local Real Estate Market?
A: No. I suspect by mid November we’ll all know who wasn’t quite prepared, but these TRID changes aren’t going to derail the strong market for home selling and buying we’ve experienced these last few years.
Q: How will agents need to prepare clients with same-day closing expectations?
A: I think we will still see demand for same-day closings for clients that wish to sell and buy on the same day, but fewer numbers of those wishing for same-day closings are likely to accomplish that in this new regulatory world. As mentioned before, working with a solid team of trusted professionals will be more important than ever in the days and weeks after Oct. 3.
Agents will need to be hyper-vigilant and know exactly who’s representing the buyer or seller on the other side of the table; they will need to work harder to protect their clients’ interests against individuals who could delay the closing process due to lack of preparation. It’s unlikely that we will see closings stretch out to the full 45 days that many are forecasting. Having an increased awareness of timelines, more vigilant agents and better-educated clients will make it easier to tell much earlier in the process how likely a timely closing will be, and whether a client will be able to sell their house and close on their new home so quickly.