As of October 1, 2015, under the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA), the loan application process and closing process will be more streamlined and more user friendly for those financing property through a mortgage lender. Within three days of submitting a borrower loan application, the lender is required to provide a Loan Estimate form to the borrower reflecting the loan terms, projected payments, and costs at closing. This form will allow borrowers to quickly and readily compare loan terms with other lenders’ offers. The Loan Estimate replaces the Good Faith Estimate and Truth in Lending Initial Disclosure forms; the goal being that the Loan Estimate is better formatted for easier understanding and only requires one form. Moreover, the Loan Estimate takes the same format as the Closing Disclosure. The Closing Disclosure is another new document that borrowers will be seeing as of October 1, 2015. The Closing Disclosure will replace the HUD/Settlement Statement and Truth in Lending Disclosure form that is provided at the time of closing; again the goal being to streamline the documents provided to borrowers for better comprehension of the loan and payment terms and costs required for purchasing or refinancing. The Closing Disclosure form must be sent to borrowers three days prior to the closing date allowing ample time for borrowers to review and ask questions. Bergeron, Paradis & Fitzpatrick is fully committed to integrating these changes to the closing process, working with lenders and borrowers to make for a smooth transition into this new process, and are excited to implement requirements that will make the home-buying and refinancing process easier for our valued clients.
If you have any questions related to the TILA and RESPA changes, please contact Real Estate Attorney Elizabeth A. Smith at 802-879-6304 or firstname.lastname@example.org