Three months after the TRID rules went into effect, the general consensus of lenders large and small is that all that preparation has paid off. For the most part, it’s been business as usual.
It took a lot of work – nearly a year, in the case of Norcom Mortgage in Avon – but “in terms of understanding the rule, everyone got there,” said Jeremy Potter, general counsel and chief compliance officer.

As expected, there has been a learning curve with the new rules. Before TRID, if a closing had to be delayed a few days or a week because the buyer, seller, or one of the attorneys had something come up, it wasn’t a big deal, but under TRID, they had to check to make sure the delay wouldn’t affect any fees or rate locks, which could result in changes to the closing documents and potential delays.

“We haven’t seen the rule itself barring the customer from getting what they needed,” Potter said.

The transition has been easy, said Paul Addamo, executive mortgage banker with William Raveis in Glastonbury – as long as borrowers are diligent about returning all the necessary paperwork on time, loans have closed in about 30 days.

“We’ve been extremely busy in December, but I think we’ll still be able to close loans in 30 days in the spring market, as long as everything goes right and buyers are prepared,” Addamo said.

But challenges remain; one of the biggest has been communication between all of the different parties involved. Before TRID, attorneys, real estate agents and lenders all communicated, of course, but now communication is between those three parties and their tech providers, adding a new layer of complexity.

 

Partners In TRID
Mortgage professionals credit their real estate partners with meeting the challenge of guiding buyers through the homebuying process – which can be stressful enough without additional layers of compliance complexity. Real estate agents are crucial to managing communication, helping to coach buyers through the process and meeting deadlines, said Patrick McGovern, vice president of sales with Connecticut Home Mortgage, adding that “excellent communication is key.”

“There’s no question that real estate agents need to be good coaches,” he said. “We need to focus on a more heightened sense of urgency on everyone’s part, though.”

McGovern said overall, TRID has forced his company to improve their service for consumers.

“We’ve changed almost every aspect of our process over the last year,” he said. “We found an amazing amount of efficiency. We’re going to be faster, more accurate and more compliant in the future.”

Realtor Margaret Wilcox, vice president of sales of William Raveis in Glastonbury, said that from her perspective, things haven’t changed all that much, although shepherding buyers through the process is more important than ever.

“We’ve been very involved with the banks, making sure buyers had all the documents they need submitted to the loan officer so there would be no delay,” Wilcox said. “Because of that we’ve not experienced any significant delays. However, I think the loan officers may be having the majority of the stress and extra paperwork. Lenders, attorneys and title insurance companies are feeling the weight of the changes more than we are.”

Wilcox said TRID is really a series of small changes that agents will learn to adopt and will ultimately become natural over time.

“One thing we’ve historically been casual about is if a buyer is going to get a credit after an inspection,” Wilcox said. Now “agents need to get that information over to the mortgage company as soon as it happens. That is something Realtors have come to recognize we have to do.”

For Norwich-based CorePlus Credit Union, a focus on members meant TRID wasn’t a big change.

“We’ve embraced it from the beginning,” Real Estate Lending Manager Barbara Zendzion said. “It’s all for consumer benefit. We always got the final numbers to the borrower as soon as possible, so having the numbers to them three days before closing isn’t a big deal for us. TRID added about a week to the process.”

Zendzion also stressed the importance of communication between all parties and said the level of understanding of the new rules among real estate agents varies.

“Some agents really have their stuff together; others you have to chase down,” Zendzion said. “A few have called me with questions. They’ll all get it eventually, or chose another profession.”

 

All In The Timing
While the Connecticut housing industry is pretty sure it has a handle on TRID compliance, the real test will come next year in the spring housing market.

“The silver lining is that we get to work through the issues while it’s slow,” McGovern said. “We’re seeing a few issues where we’ve had to redisclose and push a closing back. I am still particularly concerned about the spring market, when we quadruple the number of closings. That will be the stress test.”

He estimates that his office processed 25 to 30 loans under TRID by mid-December and is processing loans almost as quickly as it was, but the key to that is excellent communications between all parties.

“We like six weeks to close for most loans, but we can often do it in less time,” McGovern said. “We’ve done a number of rush deals. I think the biggest impediment to doing them in 30-35 days is the lack of urgency and communication. If everyone is hustling and one person breaks down, that’s going to be an issue.”

Potter concurred, adding that he’s glad the implementation was timed to coincide with the relatively slower fall/winter market, giving his firm and the industry time to get used to operating under the new rules.

“We feel like the timing was perfect to give us experience and come the spring market, most of the kinks will be worked out,” Potter said. “I actually think that six months from now, our company will be seeing the benefits of increased efficiencies and clarity. We’ll be faster than the old world by the summer.”