TRID RULE GUIDE - heritagebankfinancial.com · WHAT IS TRID ABOUT? TRID combines four disclosures...

TRID RULE GUIDE FOR WHOLESALEEFFECTIVE FOR LOAN APPLICATIONS TAKEN ON OR AFTER OCTOBER 3, 2015.

WHAT IS TRID ABOUT?

TRID combines four disclosures that are required under TILA and

RESPA into two forms.

The initial TIL and GFE will be replaced by the Loan Estimate (LE).

The final TIL and HUD will be replaced by the Closing Disclosure

(CD).

The rule is under Reg. Z and goes into effect on October 3, 2015.

loan officers will disclose GFEs and TILs through October 2, 2015 and

begin using the TRID process for applications taken on or after

October 3rd.

TRID has also replaced the ‘Settlement Cost Booklet’ with a new

publication called ‘Your Home Loan Toolkit’. This publication must

be provided by the Broker to the loan applicant within 3 days of

application (no change from the current requirement).2

ABOUT THE LE

The LE (Loan Estimate) must be delivered or placed in the mail no

later than the third business day after receiving the consumer’s

application. (No change from GFE timing)

The loan officer will not need to provide a servicing disclosure or an

appraisal notice. These documents are incorporated into the LE.

An appraisal timing waiver will be required.

The LO must receive an Intent to Proceed before the loan officer

can collect fees other than a reasonable credit report fee.

Who is responsible for issuing the LE: HeritageBank will have the

Broker be responsible for issuing the LE and any subsequent

redisclosure PRIOR to loan submission.

The Broker must notify HeritageBank immediately if they become a

ware of any change after submission. 3

ABOUT THE LE (CON’T)

HeritageBank will NOT issue a new LE (Loan Estimate) when we

receive the file. The 7 business day (includes Saturdays) waiting

period to close will be from the date the broker issues the initial LE

issues.(Currently this waiting period starts when HeritageBank issues

a TIL after submission.)

The LE (Loan Estimate) MUST be re‐disclosed within 3 days of a valid

Change in Circumstance.(Same as current GFE CIC)

The last revised LE must be issued at least 1 business day (includes

Saturdays) prior to issuing the CD.

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HOW DO I DISCLOSE LENDER PAID OR BORROWER

PAID COMPENSATION UNDER TRID?

The disclosure of compensation will not be as cut and dried as it is

now.

HeritageBank has developed a ‘Borrower Paid vs. Lender Paid

Compensation’ guide.

This guide is available on our HeritageBank website under the TRID

portal.

The short version is that Borrower Paid is disclosed on the LE and

Lender Paid is not.

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HOW DOES THE CONSUMER INDICATE INTENT

TO PROCEED?

The Broker must document the method of communication used bythe consumer which can be in‐person, oral communication over

the phone, written via email or by signing an Intent to Proceed.

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WHAT IS A “CHANGED CIRCUMSTANCE” FOR

THE PURPOSES OF A REVISED LE?

An extraordinary event beyond the control of any interested party

or other unexpected event specific to the consumer or transaction.

Information specific to the consumer or transaction that the

creditor relied upon when providing the LE and that was

inaccurate or changed after the disclosures were provided.

New information specific to the consumer or transaction that the

creditor did not rely on when providing the LE

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WILL HERITAGE HAVE A MODEL FORM FOR A

CHANGE IN CIRCUMSTANCE?

Yes.

The requirements for a qualifying change in circumstance is essentially

the same as in effect now. HeritageBank will update its form and hav

e it available for use with the effective date of TRID.

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DOES THE BORROWER HAVE TO SIGN /

ACKNOWLEDGE / RETURN THE LE TO START THE

TIMING CLOCK?

NO…The Timing clock starts when the LE is issued meaning E‐delivered

with acknowledgement, hand delivered or put in the mail.

Signing the LE does not speed up the clock.

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DOES SATURDAY COUNT AS A BUSINESS DAY

FOR ALL TIMING REQUIREMENTS?

Saturday does count as a business day for the timing of

delivery of the LE from the receipt of an application or valid CIC

and for the waiting period between the receipt of the CD and

closing.

Can borrower sign the CD at the Broker’s shop to speed up 3 day

waiting period?

No…The 3 business day waiting period would start on the date the

borrower signed the CD at the Broker shop.

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DO YOU COMPLETE THE LE WITH OR WITHOUT

LENDER NAME?

If the loan is NOT locked, you must complete the LE without

HeritageBank info.

However, if the loan is locked, then you must complete with

HeritageBank info and our loan number.

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LOAN SUBMISSION

Heritage MUST HAVE all borrowers’ correct email address(es) at the

time of loan submission. If we do not have the customers’

electronic acknowledgement we can NOT deliver the CD (Closing

Disclosure) via electronic delivery which will delay the closing.

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WHAT IS COVERED UNDER THE TOLERANCE

CATEGORIES?

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TOLERANCE CHANGES

Rather than just location on the disclosure, emphasis is now placed

on to whom a fee is paid and whether or not the consumer can

shop for the service (see tolerance chart). As a result, the following

are some significant changes:

The appraisal fee is now ‐ 0% ‐ tolerance

The credit report fee is now ‐ 0% ‐ tolerance

Any upfront MIP (including FHA/VA/USDA) is now ‐ 0% ‐ tolerance

Any fee paid to affiliate is now ‐ 0% -tolerance, including broker affiliates.

It has become especially important that the Broker make sure they

have accurate fees for each disclosure.

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CLOSING DISCLOSURE

HeritageBank will issue the CD (Closing Disclosure) after the loan is

Clear to Close.

Any person that has a Right to Cancel on a refinance must receive

a copy of the closing disclosure. HeritageBank MUST capture their

contact information upfront (see previous discussion regarding

electronic delivery).

You cannot issue a revised LE after you have issued the CD.

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TIMING REQUIREMENTS FOR THE CD

The CD (Closing Disclosure) must be provided and acknowledged

by the consumer at least three business days prior to

consummation.

If there are any changes to the CD, a revised CD must be issued to

the consumer either prior to or at closing.

If any of the following change, a revised CD must be issued and anadditional three‐business day waiting period applies:

The APR becomes inaccurate by more than .125%.

The loan product is changed.

Prepayment penalty is added.

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TIMING REQUIREMENTS CON’T

HeritageBank has sample CD timing charts to help reduce the

confusion of ‘counting days’. These charts may be used as a

reference tool to ensure timely delivery. If we do not have a valid

email address to send electronically, the CD will have to be sent by

mail which impacts how quickly the loan can be closed.

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ELECTRONIC DELIVERY OF CD

Once the loan is CTC and the CD is prepared HeritageBank will

deliver the CD to the consumer via electronic delivery system.

The consumer MUST view and acknowledge receipt of the CD to

start the 3 day waiting period.

The 3 day waiting period does not start until HeritageBank receives

verification of receipt by consumer

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ELECTRONIC / HAND DELIVERY TIMING

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KEY POINTS TO REMEMBER

The TILA‐RESPA Integrated Disclosure rule goes into effect on

October 3, 2015.

Take time to visit our TRID Resource Center at

www.HeritageBankFinancial.com

HeritageBank is here for its lending partners. Be assured that your

Team has been busy working behind the scenes to ensure a

smooth transition. Excellent service is our standard and will not

change under TRID.

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