September Letter From My Heart – New Changes Are Coming

Good morning,

As summer becomes the fall, let’s digress into a few real changes, impacting the entire loan process. We will delay our Good, Bad n’ Ugly, to next month.

Before this, here are a few points of interest concerning the Bay-area economy:

  • 2014 Santa Clara County assessed values is up more than 10.1% – third year in a row.
  • Record-breaking tax revenue for our cities and schools.
  • Santa Clara County annual median income is over $96,000.
  • Real Estate houses for sale remains 10% below in both 2013 and 2014, and matching 2012.
  • U.S. non-mortgage debt is up 5% Year-over-Year, 80% being automotive related.

Let’s begin. There is much noise from Lenders / Banks concerning future loan applications. It relates to what is called “TRID” (Tila-Respa Integrated Disclosures) and starting October 3rd, it will affect all loan applications. One of the goals is to simplifiy past pages of loan documents into one. For example, the Good Faith Estimate, Fee Worksheet, and Truth in Lending form, will become what is called the Loan Estimate. It will help summarize the loan details important to you. A good thing for all.

Changes to the closing of a real estate loan.

Under TRID, what was previously considered “normal”, will now be formalized for the closing of all real estate loans. Again, good for the consumer.

So what is the fuss? Lender / Banks. Why? Because they will be totally liable for the accuracy of each loan document. Is it needed? Yes as has been exemplified by the many lawsuits / settlements, over the past years. Sadly the media and real estate industry seems to have under-reported this necessary and needed change.

New “TRID” rules will affect you in two important ways.

First: Before final Loan Documents can be signed, the borrow must have 3-days “prior to” signing the closing documents (CD). This will better protect the consumer, as today only refinance loans provide a 3-day cooling off period, and this only after signing. This new change will be for ALL financing, i.e., purchase, refinance, and private / hard money loans.

This is a needed changed, helping to level the playing field and improve consumers satisfaction. The new 3-day period begins the day the borrower receives the hard copy of the Closing Disclosure (CD).

Second: If there is any significant change to the Closing Documents (CD), the Lender / Bank is required to redraw a new CD. With this change, the 3-days clock starts anew. This may be cumbersome, but it keeps the client aware and involved.

My take: This move is GREAT for the consumer, improves the industry, and one we have been promoting. Questions can be answered well before the closing, removing the pressure of the closing itself. The consumer will feel better and so will everyone else. Everybody is better off and thus everybody a winner.

Personal contact is what our clients expect from us and what we deliver.

Our goal is to help bring success to our clients and promote a secure financial future. We love the market place and love to see our clients smile with the success of a smooth closing. And when the market changes, or even the laws, we are ready and will keep you informed. It is an important part of getting the work done.

If safe and informative financing is important to you, as it is for us, please give us a call. We are here for you and ready to bring a smile to your face.

Have a fabulous September, and we look forward to talking with you soon.

Gratefully yours,

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