August 1 2015 Getting from Contract to Close in home buying is changing.
****update 1 OCT 2015 is new date****
Have you been hearing the buzz about Real Estate process changes regarding financing coming to market on August 1 2015? No? Yes?
Best guess is if you have not heard about the changes- you may have some curiosity or questions. If you have heard about the changes – you may have some questions.
Let’s face it- much of what is changing has to do with what goes on behind the curtain and ‘doesn’t seem’ to affect you, but I can assure you it will have an affect upon your home purchase and home selling plans. So let’s look at bits and pieces of the changes over the next 60 days…….(remember that phrase- …the next 60 days… as we move along- it will come to hold deep meaning in the end- I promise!)
To most folks- banking and finance can work like a sleeping pill with immediate sleep action…………..zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzz.
So if you are one of the few that gets AMPED up talking banking terms and finance arrangements- Good for you! For the rest of you Please go grab a cup of coffee- get comfy- and perhaps have some sort of slow burning carb/protein mix so you can hang in there- awake- for this discussion! Yeah- it is THAT important.
What we are talking about here is the RESPA TILA (or Truth in Lending Act) Integrated disclosure rule set to take effect August 1 2015. To sum up- beginning August 1 2015 there will no longer be a Good Faith Estimate or a Truth In Lending Disclosure.
These two forms, which most of us are familiar with- if not in practice at least in name- are being combined into one single Loan Estimate.
Then at the end of the process, again most of us have heard of the HUD-1 settlement statement and the final Truth in Lending document- again these are being combined into what will now be called a Closing Disclosure document.
This new ‘Closing Disclosure Document’ is now required to be given to the consumer (home buyer) at least THREE days before closing. and here is the important part of that phrase–> ‘…any significant changes to the loan terms could reset a new three-day waiting period and delay closing.’
Why is this part important- let’s start with the obvious- Rate Lock. They expire. If you had a Rate Lock at 3.1% and it was a period of high volatility and rates were climbing daily and toward end of your contracted ‘lock’ the rates were closer to 4% could that prevent you from buying the home under contract at the price under contract- in many cases- yes, yes it could.
Time Lines and Time Frames are going to be ‘critical’ to get from contract to close as of August 1 2015 for anyone using financing to purchase property.
Next discussion will be about the ‘delivery time frame’ for these documents!
If after hearing about the changes you are still in the market for a home – or needing to list and sell your home- then let’s talk today. Call me, Dawn, today at Heritage Properties spc and let’s start the journey toward making ‘YOUR home ownership dreams a reality!”
860-739-4455 ext 33 office