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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.
4
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.
8
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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