Countdown to 08.01.2015 …Ooops, 10.01.2015
Don’t worry, neither is the Consumer Financial Protection Bureau (CFPB). The CFPB announced on Wednesday, June 17, 2015, that it won’t make its target date of Aug. 1 to roll out the new TRID rule.
CFPB Director, Richard Cordray, announced a proposed amendment to delay the effective date of the Know Before You Owe rule until October 1, 2015. “We made this decision to correct an administrative error that we just discovered in meeting the requirements under federal law, which would have delayed the effective date of the rule by two weeks,” said Director Cordray.
“We further believe that the additional time included in the proposed effective date would better accommodate the interests of the many consumers and providers whose families will be busy with the transition to the new school year at that time,” Cordray added.
The announcement comes shortly after the CFPB announced that it will honor a grace period for servicers attempting to comply in good faith with the TRID rule. The rule greatly impacts the real estate market. Lenders, servicers, brokers, and title agents will all be affected by the costs that are required to implement and comply with the rule. Lawmakers and industry gurus have been requesting that the CFPB delay the rule’s effective date for months. While declining to push back the August 1 date, the CFPB announced that it will enforce a grace period. Click the following links to see a copy of Congress’ letter and Cordray’s response.
The TRID rule also referred to as the Know Before You Owe rule intends to simplify and improve the mortgage transaction disclosure forms, including the HUD-1, Good-Faith Estimate and TILA forms. The rule creates new two mortgage disclosure forms: the Loan Estimate, given three business days after a mortgage loan application is received, and the Closing Disclosure, given three business days before closing. These new disclosure forms consolidate the TILA-RESPA forms and are meant to give consumers more time to review the costs associated with their mortgage transaction.
“The public will have an opportunity to comment on this proposal and a final decision is expected shortly thereafter,” ended Cordray. Whether the CFPB attributes the delay to administrative errors or the new school year, at least for now, we have some time.
Click here to read CFPB Director Richard Cordray’s official statement.