CFPB’s long-awaited and much-anticipated Proposal for updating the “Know Before Owe” rules, or TRID, as it is better known to the lending industry, are now out. (Read all about it)
The proposal answers some questions, clarifies prior comments, leaves some things unanswered, and closes the door on certain specific issues of major interest to the industry.
CFPB indicates that it will not reopen certain major policy decisions made during the initial rulemaking. The main example of this, much to the disappointment of lenders, is the issue of specific cure provisions for technical errors made in the disclosure process.
CFPB stated that to do so “would not be practicable without substantially undermining incentives for compliance with the rule” and that it “would be extraordinarily complex.” Nice way of saying, “We ain’t going there”.
As a result, lenders better be very careful to be accurate, and timely, when issuing their required disclosures. The original cure provisions for fee or clerical errors are available but nothing more in this proposal.
Title providers are disappointed the proposal does not address simultaneously issued Lenders and Owners policies. Maybe CFPB believes that two policies shouldn’t be necessary. Should the title insurance industry consider a combined policy? Two for the price of one? That would simplify things for everybody. One disclosure item; one fee; one policy.
For the most part, the proposal appears to include and clarify certain information provided by CFPB in prior announcements, webinars and other forms of informal guidance. The biggest being the issue of the “Black Hole”. Oh, happy day!
Under this proposal, a lender could use a revised Closing Disclosure to update bona fide fee changes after issuance of the initial CD. This is a big one. If a closing is delayed, a lender will no longer be required to eat any fee increases as a result of the delay.
So, as it is in most things, you don’t always get everything you want. Now it’s your turn. The comment period is now open. If you’re not satisfied or want more, make our voices heard loud and clear.
If you don’t, you have no one to blame but yourself.