Dennis' Mortgage Blog

I sent the following to my contacts in the real estate community and think it should be more widely spread:

In an effort to rid America of unscrupulous lenders and originators, starting July 31, 2009 the real estate industry will have a new regulation that will impact escrow closings.  Lenders will not be allowed to fund mortgages until seven days after delivering a Truth In Lending disclosure to the borrower and three days have passed following the borrower signing the final Truth In Lending (TIL) disclosure document provided with loan documents.  Ironically of all the documents we have borrowers sign, none have more questions or are more confusing than the TIL, yet this is the one document Federal regulators feel they can use to get rid of liars, cheats and dishonest brokers and lenders.  I am hoping you sense my sarcasm and elation at the same time!
 
No more sign docs on Monday, get them back to the lender and fund on Tuesday.  Moving forward it will be sign docs on Monday and let three days elapse, Tuesday, Wednesday, Thursday, fund on Friday (unless Los Angeles County which does not have same day recording so funding probably pushed to the following Monday).  So the timing on closings will impacted by this new law starting July 31st.
 
I will have more information on the mechanics of the new regulation following two separate classes I participating in next week to get different lenders' perspectives and how they will be implementing the TIL disclosure regulation.  In the meantime it will be imperative that escrow officers and companies are familiar with the regulation as well since any changes in fees after the lender mails the initial TIL will result in a new TIL and the clock starting over again.  
 
In the past year or more we have become even more adept as an industry in adapting to new guidelines, policies and regulations, here is one more we will all need to get used to in order to stay successful.  As I get more information I will certainly pass it along.
 
Remember, despite the changes and new regulations and shifting market, we are engaged in a very noble profession: helping families achieve the American Dream of homeownership.  We just have to become more flexible and patient with that help and assistance!
 
If you have any questions please contact me.
Posted by Dennis C. Smith on July 15th, 2009 9:53 AMPost a Comment (0)
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