TRID RESOURCES
Resources and Program Proposal for Compliance Small and large businesses alike are grappling to update their business models and software to be in compliance with the upcoming implementation of the TILA-RESPA Integrated Disclosure (TRID) rule effective on August 1, 2015. Four different rules were consolidated into two to form the cornerstones of TRID. The RESPA Good Faith Estimate and Initial Truth-In Lending disclosure were combined to create the Loan Estimate form. RESPA HUD-1 and the Final Truth-In Lending Disclosure merged to form Closing Disclosure.
compliant. Compliancy is largely contingent on access to updated software. The software used for mortgage lending must have the 3.3 version of Mortgage Industry Standards Maintenance Organization (MISMO) or higher. However, many loan origination systems (LOS) have yet to update their systems as it is a large overhaul, leaving some professionals in the industry struggling to adjust.
To allow time to adapt, the CFPB gave professionals affected by the rule almost two years to gain broader awareness, update systems, and train employees before implementing the rule on August 1, 2015. In addition, the CFPB released a host of free resources that included Loan Estimates must be hand-delivered or placed in the a series of educational webinars, a plain-language complimail within three business days ance guide for small businesses “ TRID will require updated after an application is received. that lack the guidance of their In contrast, Closing Disclosure software to accommodate the own legal and/or compliance must be given to the consumer departments, readiness guide, new fee disclosures.” “at least three business days priand illustrated instructions on or to consummation,” according to the Consumer Finance how to complete the new forms. Protection Bureau (CFPB). Consummation is defined as the moment a consumer is considered contractually obli- To better represent the voice of small businesses, Rep. gated on a credit transaction. Robert Pittenger (R-NC) and Rep. Heck (D-WA) introduced H.R. 1195—Bureau of Consumer Financial With Closing Disclosure, numerous variables will re- Protection Advisory Boards Act. Passage of the bill quire a three business day waiting period. These variables would establish a board of 15 to 20 members at the include the addition of a prepayment penalty, changes in CFPB that will represent small businesses with an emloan products, and inaccuracies in disclosed APRs. Cur- phasis on women- and minority-owned small business rently, detailed explanations of each section of both the concerns. Introduced on March 2, 2015, the bill has Closing Disclosure and Loan Estimate form are avail- passed in House and is awaiting passage in the Senate. able on the CFPB’s website; sample forms are available online as well. Other organizations have joined the CFPB in releasing resources for those in the mortgage industry. The followTRID will require updated software to accommodate the ing organizations offer their own educational guides to new fee disclosures. This update in technology systems aid in the successful implementation of TRID: Mortis where many small businesses are struggling to remain gage Banking Association (MBA), National Association
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