Did TRID Change 30 Day Mortgage Closings

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Many Real Estate and Mortgage professionals claimed Armageddon when TRID and October 3rd, 2015 approached.  The TRID-quake did not hit, and never will.  TRID’s sweeping arrival had as much unnecessary hype as Y2k did.  Remember what all happened there?   Me neither.

Unlike Y2k, TRID did impact an industry.  However, nothing that carried the weight that the hype was predicted.  The TRID changes in many cases made Arizona Real Estate Laws now Federal Laws.  For example, us desert dwellers had been used to the 3 day prior to close rule years before this “TRID” thing came along.  After TRID, well now everyone has to do abide by the 3 day rule (read on for more).  Prior TRID, the Fed did not enforce it and now they do.  That’s called accountability – not Armageddon.

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The Future of the 30 Day Closing

In most cases 30 day closings were unaffected by TRID.  Communication became even more important after TRID.  The big difference is that pre Oct 3, 2015 the parties involved in a real estate transaction could choose to allow a transaction to close even if  loan documents weren’t out 3 days prior to the closing date.  Post Oct 3, 2015  a transaction cannot close if the Closing Disclosure is not signed by the buyer(s) in time. No more “allowing” the deal to close – the Fed will not let it close.

What Does Need to be Out 3 Days Before Closing?

The most common TRID fear was “loan docs need to be out 3 days prior to closing!!”  That was and is incorrect.  Should loan documents be out at least 3 days before closing?  Yes.  However, they do not need to be out 3 days prior to closing per TRID.  Although, they do need to be out 3 days prior per the Arizona Real Estate Contract.

The Closing Disclosure is the key.  This document absolutely needs to be signed by the buyer(s) 3 days prior to closing.  This corrected understanding of TRID adds some cushion for last-minute hurdles.  For example, things like an appraisal issues or short rush closings etc might need that extra padding.

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Writing language in a contract that protects a buyer became more important than it already was.  When Real Estate Agents have the proper understanding TRID they can protect their clients.

The 30 day closing is still very much alive and well!

By Jeremy house

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