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TRID Impact on Real Estate Market

“Know Before You Owe” Form


The Truth in Lending Act / Real Estate Settlement Procedures Act notices and regulations have been combined by the Consumer Financial Protection Bureau (CFPB) in to one form:  TRID.  The nickname for this new form is “Know Before You Owe.”

Mortgage Professionals’ Complaints About TRID

Mortgage professionals say that real estate closings have been delayed about five days since the TRID disclosure requirements went into effect October 3, 2015.  They also claim that the costs of getting a loan have gone up also.

“One reason for the delays is that many of our clients truly do not understand TRID,” Green says. “We have clients that are manipulating documents in order to avoid cure rates. Another reason is that borrowers are renegotiating their loans at the last minute, which, in many cases, causes another three-day waiting period.


Mortgage lenders also complain that when they have a question before settlement, the CFPB doesn’t answer their questions because there are so many people emailing them from the general public.  While that may be true, it is also true that the TRID form simplifies the mortgage settlement process and the industry should be able to adapt quickly.  Others in the real estate industry think the TRID change resulted in the big decline in existing home sales in November, 2015.  That would be a problem if you thought the creation of a simpler form to replace two other forms prevented people from buying houses.  Would you rethink the purchase of a home because of a new form?  What if that new form, TRID, meant there was a longer time before settlement?  We didn’t think so.  The reasoning by the real estate industry in blaming home sales on the TRID form is a little far-fetched.

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