In the real estate field there has been much discussion lately about the new disclosure forms that will be required in sale of one-four units. They replace Good Faith Estimates, Truth in Lending and Closing Statements. The Consumer Financial Protection Bureau developed the forms to combine four previous forms into two. The Dodd-Frank Act mandated that this change happen. The new forms must be used after October 3rd.
Many segments of the real estate industry are lamenting this decision. There were complaints that there had not been enough lead time even though the forms had been announced at the time of Dodd-Frank. Lenders are concerned about enforcement penalties, settlement companies are worried about having software ready, Realtors do not like the strong possibility that sales will be delayed, and so on and so forth. There is one question that I have not heard discussed.
The CFPB created the two forms, and their mission is to “Protect the Consumer.” My big question then, “Is this form going to be a “good thing” for the buyers and sellers?” Real Estate professionals, what do you think about that?
The stated reason for the change is to give the consumer better information in an easier to understand format so they can compare possibilities and make more beneficial decisions in their transactions. My feeling at this time is that the forms are far from perfect even after all the money and time spent on them, but they are an improvement.
Will this be the end of the world as we know it? I do not believe so. This is the game we have, and we all have until October 3rd to get ready to play, and that includes buyers and sellers. MLO’s, we will be covering TRID and all the new changes in our live MLO classes, looking forward to seeing you there. Check www.DuaneGomer.com for a schedule or call 800-439-4909. See you in class.