Lending Real Estate

TRID works: More homebuyers actually review mortgage documents

ALTA survey shows new CFPB forms more likely to draw consumer attention

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It’s undeniable that the implementation of the Consumer Financial Protection Bureau’s TILA-RESPA Integrated Disclosures rule had an impact on the mortgage business.

Despite the long lead time that the CFPB gave the industry to prepare for TRID, which is also known as "Know Before You Owe," there were still hiccups and headaches for the industry, but it appears after all the frustration and consternation, TRID is working as designed for consumers.

According to a new survey conducted by the American Land Title Association, a significantly larger portion of homebuyers are actually reviewing their mortgage documents prior to closing than they were before TRID’s implementation in October.

ALTA’s survey, which is based on a comparison of data collected before TRID to data collected post-TRID, showed that nearly 20% more homebuyers are reviewing their closing documents in the post-TRID world.

“Title and settlement agents went to great lengths to prepare and train staff prior to implementation of the regulation,” said Michelle Korsmo, ALTA’s chief executive officer.

“The hard work of these professionals paid off as 92% of surveyed homebuyers are taking time to review their mortgage documents before the closing,” Korsmo continued. “This compares to only 74% of consumers who reported having reviewed their documents prior to the new regulation.”

ALTA’s results are based on two separate surveys of homebuyers.

According to ALTA, the first round of data was first collected before the implementation of TRID to assess the closing experience of more than 800 homebuyers using the HUD-1 Settlement Statement.

The second phase gathered information from nearly 700 homebuyers about their closing experience under the new rules requiring use of the Closing Disclosure.

And the results show that the homebuyers are indeed “knowing before they owe” more than ever before.

ALTA’s survey also showed that there have been minimal delays on closings since the implementation of TRID.

According to the survey, prior to implementation of TRID, homebuyers reported that 77% of closings took place as scheduled.

While the new Closing Disclosure form, 74% of closings are taking place as scheduled.

Those results echo a recent report from Ellie Mae that shows, according to Ellie Mae’s report, the time to close all loans dropped to an average of 44 days in March.

That’s the shortest time to close since March 2015 and down two days from February, when the time to close fell to 46 days.

And February’s closing time of 46 days was a significant drop from January, when the average time to close was 50 days.

So is TRID working as designed? It certainly appears that way.

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