I always say, “It’s never too early to plan for the future”.
Sound kinda corny but being forewarned is being forearmed and the changes that are coming to how you buy a house will have a broad and lasting effect on everyone interested in buying or selling a house starting August 1st of this year!
For those of you thinking of buying or selling a home later this Summer, please listen up! The good ole days of simply reviewing the HUD-1 settlement form and getting a Good Faith Estimate (GFE) from the lender are about to come to a screeching halt. In less than 2 months, those two forms are going away and everyone in the real estate industry needs to not only know and understand the new forms…but they have to be able to explain to their clients why their deal is now going to take a lot more time to close.
The Truth in Lending Act (TILA) disclosure form is going away, as well. The two new forms are designed to be more simple for the consumer use and understand: the Closing Disclosure and the Loan Estimate. I’ve posted links below if you want to learn more about these new forms.
The way loans are closed are changing too.
The rule for escrow requires all forms to be ready 3 days prior to closing. My lender is telling me that in order to be sure everything is in order, buyers need to make certain all docs are ready seven days prior to closing, so when you go into the three-day period, no changes need to be made essentially starting that 3 day clock again.
What this means is, you and the other settlement service providers, including the lender and title agent, are under the gun to get everything squared away earlier than you have to today. And the buyers and sellers have to be cooperative as well, because if last-minute changes are made, a new three-day waiting period kicks in, at least in some cases.
What does this mean for anyone looking to buy or sell right now?
Basically, you have until August 1 so you better get a move on! In order to be one with the new forms and learn about the new closing procedures. I’ve attached a couple of links to get you on your way.
From the Consumer Financial Protection Bureau…or CFPB
From the American Land Title Association…or ALTA
Why Is This Happening?
The CFPB’s goal in making these changes is to increase transparency for consumers. It’s been something in the works for sometime. The confusion for the consumer has led to numerous issues for some of my clients so I’ll be very interested how this all shakes out. One thing is for certain, loans will take longer to close as these new forms become an everyday part of our new real estate world…hold tight!
I am passionate about Real Estate and eager to answer all of your real estate questions! Text or Call me at 360-880-2356 or email me directly to ask about Buying, Selling or Investing in today's Real Estate Market - serving Lewis County & Thurston County, WA.
Certified Residential Specialist | Real
Mountain Valley Real Estate