TRID: The Know Before You Owe Rule
We have all been talking about the TILA/RESPA Integrated Disclosure rule, also known as TRID. Since this rule is designed to help borrowers understand the terms of their home financing transaction, there is a trend to start referring to this rule as the Know Before You Owe rule instead of TRID. The Know Before You Owe rule took effect October 3, 2015.
So what can you expect now that this rule is in effect?
First, you will see consumer disclosures that are very easy to read. The Loan Estimate forms will clearly set forth the terms of the proposed transaction to help the borrower determine whether they would like to proceed with the transaction.
Next, consumers will be given their Closing Disclosure early. Before closing on a home purchase or refinance, consumers must receive a copy of their Closing Disclosure at least 3 business days prior to closing so if they have questions, their Loan Originator can provide them with additional information. The format of the Closing Disclosure will also mirror the Loan Estimate to make comparison easy.
This new rule was designed with consumers in mind. For additional information about this rule, please see our educational videos below.
What is TRID?
Let's break it down into real language
What does TRID stand for? TRID is the TILA / RESPA Integrated Disclosure Rule. Only in the mortgage world would we make an acronym out of acronyms... so let’s break this down a little further. TILA is the Truth in Lending Act and RESPA is the Real Estate Settlement Procedures Act. The CFPB modified both rules in its TRID final ruling.
Watch the videos below with the AmeriFirst Financial Corp. Senior Vice President of Compliance, Sheila Strong. Whether you're a home buyer, a real estate agent or an industry expert, Sheila will offer insights into what this change means for you.