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TRID
TILA/RESPA Integrated Disclosures
1
Any residential loan originated after
October 3, 2015
will be subject to the new rules
and forms set forth by the CFPB.
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Combining New Forms
Loan Estimate (LE)
Replaces the GFE and Initial TIL
Must be received by the borrower or placed in the mail no later than
the three (3) business day after receiving the borrower’s application
(as defined by RESPA).
Closing Disclosure (CD)
Replaces the Final TIL and HUD-1 Settlement Statement
Must be received by the borrower at least three business days prior to
consummation.
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Application Definition
LOAN AMOUNT
ESTIMATE OF PROPERTY VALUE
PROPERTY ADDRESS
BORROWER NAME
SSN
INCOME
Six Pieces of information
The CFPB has revised the definition of application to
remove the seventh “catch-all” element of the current
definition under Regulation X, that is, “any other
information deemed necessary by the loan originator.”
Since 2010 our “catch-all” element was the credit
report. We will now consider it an application as soon
as the above information is received.
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Delivery of the Loan Estimate
THE LE MUST BE PROVIDED TO THE
BORROWER IN PERSON OR PLACED
IN THE MAIL (EITHER USPS OR VIA
EMAIL) WITHIN THREE (3) BUSINESS
DAYS OF RECEIPT OF APPLICATION
AND SEVEN (7) BUSINESS DAYS
BEFORE CONSUMMATION.
NMSI defines a “business day” as Monday
through Saturdays, excluding Sundays,
and federal holidays.
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7 Days Waiting Period
HOW TO COUNT THE 7 DAYS WAITING
PERIOD
.The 7 days will be counted as such:
If the LE is provided to the borrower in person, the 7
days begin that day
If LE was delivered priority overnight and the borrower
signs receipt of delivery, the 7 days begin that day.
in person
overnight
email
usps
If the LE is delivered via email and the borrower
acknowledges via e-signature, the 7 days begin that
day.
If the LE is delivered via email or USPS mail and the
borrower does not provide confirmation of receipt as
listed above, the 7 days begin after 3 days have
passed.
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Important Information for Submission
FEE WORKSHEET
You should contact your settlement
agent as soon as possible after having
an application, to gather an estimate
of fees to properly disclose the LE.
You may have to take a new
application if the LE is improperly
disclosed.
INTENT TO PROCEED
Make sure to check the box and fill in
the date borrower (s) provided intent
to proceed.
SETTLEMENT AGENT
CONTACT INFORMATION
Settlement Agent E-mail is critical.
This allows for the Closing Disclosure
(CD) to be delivered timely and not
jeopardizing the Closing Date.
SETTLEMENT SERVICE
PROVIDER LIST
Settlement Service Provider List is
required, otherwise all fees that are
required by the lender will be subject
to 0% tolerance.
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Fee Charge
01
WHAT FEES CAN I CHARGE THE
BORROWER?
Credit report (this is the only bona fide fee
that can be charged to the borrower prior to
the intent to proceed).
02
WHAT FEES CANNOT I CHARGE THE
BORROWER?
The loan originator may not order and pay for an
appraisal without the intent to proceed.
No post-dated checks, no credit card numbers
on file.
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Loan Estimate – Page One
General Loan Information
General information
•
Address of creditor, date, address, rate lock, etc.
Loan Term Table
•
Loan amount, interest rate, monthly P&I
Project Payment Table
•
P&I, MI, estimated monthly payment
Cost at Closing Cost
•
Estimated Closing Costs
•
Estimated Cash to Close (Not on Current GFE)
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Loan Estimate – Page Two
Closing Cost Details
What’s Different
1. The 800, 900, etc. series of fees no longer exist.
2. Must be listed alphabetically with title fees preceded by “Title –”
3. Fees must be rounded to the nearest whole dollar amount (e.g. a
$13.75 charge will be rounded to $14.00)
4. The credit for interest rate chosen will be shown as “Lender Credits”
under “J. Total Closing Costs”
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Loan Estimate – Page Two
Closing Cost Details
Loan Costs
A. Origination Charges
• 0% tolerance items.
B.
Services You Cannot Shop for
• 0% tolerance items.
C.
Services You Can Shop for
• 10% tolerance items.
• Settlement Service Provider List is required, otherwise all fees
that are required by the lender will be subject to 0% tolerance.
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Loan Estimate – Page Two
Tolerances
Zero Tolerance
• Fees paid to the creditor, mortgage broker, or affiliate of either,
Appraisal Fee, Credit Report, Transfer Taxes…
10% Cumulative Tolerance
• Recording fees, Charges for third party services where the
charge is not paid to the Creditor/Lender or the Creditor/Lender’s
affiliate..
• Settlement Service Provider List is required, otherwise all fees
that are required by the lender will be subject to zero tolerance.
Variances permitted without tolerance
• Prepaid interest, property insurance premiums, amounts placed
into escrow..
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Loan Estimate – Page Two
Closing Cost Details
Other Costs
E. Taxes & Other Government Fees
F. Prepaids
G. Initial Escrow Payment
H. Other
Calculating Cash to Close
Adjustable Payment (AP) Table
• only prints if interest only or interest only ARM
Adjustable Interest Rate (AIR) Table
• only prints if ARM or interest only ARM
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Loan Estimate – Page Three
Additional Information
Contact information
Comparisons Table
• Total Interest Payment (TIP)
 Replaces the Total Payments from the initial TIL
Loan Amount: $100,000
Total Interest: $50,000
TIP: 50%
Other considerations
•
•
•
•
Appraisal
Assumption
Late Payment
Servicing
Signature statement
• Acknowledging receipt does not equal intent to proceed
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Important Notes
01
SINCE YOU ARE NOT SURE WHO THE LENDER
MIGHT BE ON YOUR TRANSACTION, LEAVE
THE LENDER NAME AND LOAN ID BLANK ON
YOUR LE
02
CONTACT YOUR SETTLEMENT AGENT AND
ALL THIRD-PARTIES TO GET A DETAILED LIST
OF THEIR FEES, AS SOON AS YOU HAVE AN
APPLICATION
03
READ THE PURCHASE CONTRACT, IF
APPLICABLE, FOR ANY INSPECTIONS OR
OTHER THIRD-PARTY FEES.
04
INPUT YOUR ORIGINATION FEE ON THE LE,
EVEN IF YOU THINK YOU ARE DOING A
LENDER-PAID TRANSACTION OR YOU CAN’T
GO BPC. ONCE LOCKED LPC CAN NOT BE
SWITCHED.
05
DO NOT COLLECT ANY FEES, EXCEPT FOR
CREDIT REPORT FEE, PRIOR TO THE INTENT
TO PROCEED RECEIPT DATE.
06
NMSI WILL HANDLE COCs AND THE CD FOR YOU.
THE CD IS SENT AS EARLY AS POSSIBLE TO
ENSURE YOU MEET YOUR CLOSE OF ESCROW.
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Change in Circumstance
Valid change in circumstance
CHANGE AFFECTING SETTLEMENT CHARGES
• Inaccurate or changed information specific to
consumer or transaction (similar to RESPA today)
• New information specific to the consumer or
transaction
CHANGE AFFECTING ELIGIBILITY
• Consumer is ineligible because of changed
circumstance such as creditworthiness or value
of security.
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Change in Circumstance - A revised Loan Estimate
Revised LE delivery & timing
A revised Loan Estimate must be delivered or placed in
the mail to the Borrower no later than 3 business days
after receiving a bona fide change circumstance.
The revised Loan Estimate must be received by the
Borrower no later than 4 business days prior to
consummation.
A revised Loan Estimate cannot be issued on or after the
date the Closing Disclosure is provided.
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What is Closing vs. Consummation?
THE RULE INTRODUCED A NEW TERM INTO
REAL ESTATE TRANSACTIONS. THE TERM IS
CONSUMMATION AND IS DEFINED IN THE
RULE AS THE DAY THE CONSUMER BECOMES
LEGALLY OBLIGATED UNDER THE LOAN. THIS
WILL GENERALLY BE THE DATE OF SIGNING A
NOTE AND/OR NOTARY DATE.
Consummation may be different than the closing date
as defined in the purchase agreement where the buyer
becomes contractually obligated to a seller on a real
estate transaction. In most cases these two dates are
not the same and clearly have very different meanings.
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Closing Disclosure– Page One
General Loan Information
General information
•
Lender name, loan term, purpose, and loan type
Loan Term Table
•
Loan amount interest rate, and P & I payment
Project Payment Table
•
PITI payment
Cost at Closing Cost Table
• Similar to boxes A and B on page 1 of the LE
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Closing Disclosure – Page Two
Closing Cost Details
Loan Costs
•
Origination and third party charges
Other Costs
•
Recording fees, and escrows
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Closing Disclosure– Page Three
Closing Cost Details
Calculating Cash to Close
•
including Seller Credit
Summaries of Transactions
•
Purchases Only
Payoffs and Payments table
• Refinances Only
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Closing Disclosure– Page Four
Additional Information About This Loan
• Loan Features
• Loan Disclosures
• Assumption Information
• Adjustable Payments for Interest Only or Interest
Only ARM loans
• Adjustable Interest Rate (AIR) tables for ARMs only
(including Interest Only ARM loans)
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Closing Disclosure– Page Five
Additional Information About This Loan
• Loan Calculations
• Other Disclosures
• Contact Information
• Confirm Receipt
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Closing Disclosure
Borrower must RECEIVE Closing Disclosure 3 days prior to closing.
IN PERSON
• Receipt is presumed immediately, signed disclosure
required. Closing may occur 3 days later.
US MAIL
• Receipt is presumed after 3 days. Closing may occur
3 days after receipt. (6 days total)
ELECTRONICALLY
• Receipt is presumed after 3 days. Closing may occur
3 days after presumed receipt or 3 days after proof of
actual receipt.
• Closing could be as soon as 3 days if received same
day or 6 days if presumed receipt.
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Closing Disclosure Timeline
Closing Disclosure Delivery Time Table
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Closing Disclosure
BORROWER MUST RECEIVE CLOSING
DISCLOSURE 3 DAYS PRIOR TO CLOSING.
NMSI will send out CD if followings are met and DO NOT
require to be “Clear to Doc” status.
The Loan is LOCKED
Appraisal is CLEARED
NMSI WILL
PREPARE AND DELIVER
THE CLOSING DISCLOSURE
Settlement Fee & Information are FINALIZED
Taxes are FINALIZED
Insurance (MI&HOI) are FINALIZED
“COLLABORATION” process will occur
electronically via Doc Magic.
Real Estate Agent Information
“ If the CD is delivered electronically via a DocMagic and the borrower does not access the CD,
then it’s not considered as received.”
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Re-Disclosure
If the CD is re-disclosed for the following reasons,
a 3-business-day waiting period applies:
• APR increases by more than 0.125%
• Loan program changed
• Prepayment penalty was added
If the CD is re-disclosed for any other
reason, there is no waiting period applies.
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Team Work - Communication
Early communication with realtors, borrower, title companies,
LO’s, and lender crucial for a smooth transaction..
BORROWER
[email protected]
LENDER
[email protected]
SETTLEMENT AGENT
[email protected]
MLO
[email protected]
REALTOR
[email protected]
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THANKS FOR WATCHING
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