Real estate closing changes are still months off and yet an article in Origination News reports that lenders are already going “crazy” over the new CFPB closing disclosure statement. The rule modifications that go into affect August 1 are one of the most revolutionary changes to the real estate industry in decades. You don’t have to face the changes alone. Easysoft Legal Software is here to help you through the transition with our real estate closing software.
Big Changes Ahead
The closing disclosure statement puts a heavy burden of responsibility on lenders. The new rules and timelines are more rigid with little room for something as simple as a delay in the postal service. Lenders are going to have to start preparing forms earlier in the process, with no way to make corrections at the last minute.
The closing disclosure is not simply a cosmetic update of the old HUD 1 settlement statement. The CFPB has made fundamental changes to closing policies and fee organization that are going to be challenging to real estate professionals who have been completing the HUD 1 for years. Among the changes are that fees must be categorized differently than before and there are no line numbers for easy reference to closing fees. Probably the biggest change is that the closing disclosure combines information from the HUD 1, which was traditionally provided by the title company, and the Truth In Lending statement, which was provided by the lender.
Lenders Taking Over The Process
The bulk of the responsibility and liability falls on the lender’s shoulders. Some big lenders such as Wells Fargo and Bank of America have already announced they will assume greater control of the closing process to be sure the forms are produced correctly and promptly. Smaller lenders such as local credit unions believe they can’t do the same because they don’t have the resources of big lenders.
That latter statement is not true. Inexpensive settlement statement software such as Easy HUD put the right closing tools into the hands of any organization no matter how small. We are in the process of updating Easy HUD to comply with the new regulations and will release it well before the August 1 deadline as a free update to our current subscribers.
Now is the perfect time to join the Easysoft Legal Software family. Allow Easy HUD to guide you through the new forms and processes associated with real estate closing so you can be sure you are handling closings correctly.
*Update (7/23/2015): The CFPB announced the Truth in Lending Act and Real Estate Settlement Procedures Act Integrated Disclosure Rule (TRID) implementation date has officially been moved from August 1 to October 3. Learn more about the TRID Rule
If you have not yet upgraded your real estate closing software to be TILA-RESPA compliant, learn more about EasyCDF, our fully TRID compliant closing software.