Berkshire Hathaway HomeServices Florida Network Realty’s
Agents are Well Prepared for Transition

If you’re buying or selling a home in Northeast Florida, some recent federal changes with regulatory compliance could impact your transaction.

As of Oct. 3, the TILA-RESPA Integrated Disclosure Rule went into effect for most home sales nationwide. The rule is administered by the Consumer Financial Protection Bureau, a governmental division created to address money and consumer finance issues.

“The intent is to make residential real estate transactions and the lending process easier to understand for homebuyers,” said Berkshire Hathaway HomeServices Florida Network Realty Founder, President and CEO Linda Sherrer. “It is designed to eliminate many of the complexities of the current process, making the lending and closing process a better experience for everyone involved.”

The impact of the new forms and the waiting periods touches everyone involved in residential real estate transactions including homebuyers and sellers, real estate agents and brokers, lenders, title insurance and settlement services providers and homebuilders.

The TILA-RESPA Integrated Disclosure affects most consumer loans secured by real estate. It debuts two mortgage loan disclosure forms and installs new waiting periods for closing most real estate loans, including FNMA, Freddie Mac, USDA, VA, FHA, other government-backed and conventional loans and some owner-financed transactions.

When applying for a loan, the Loan Estimate Disclosure Form replaces the Good Faith Estimate and Truth in Lending disclosures. It shows the borrower the sales price, loan term, type of loan and rate-lock information. It also shows the loan amount so borrowers will need to make sure it accurately reflects their available down payment.

The form must be given to the borrower within three business days following a loan application. A seven-business-day waiting period is mandatory before a borrower may sign loan documents after receiving the documents and informing the lender of his or her intent to proceed.

The second component is the Closing Disclosure, which shows transaction terms and costs. The Closing Disclosure must be received by the borrower three-business-days (as opposed to the previous one-day requirement) before he or she signs loan documents.

“The Closing Disclosure is intended to reduce surprises regarding the amount of cash borrowers will need to bring to the closing table,” said Broker/Executive Vice President Christy Budnick. “The three-business-day waiting period gives borrowers more time to read their final closing documents and ask questions so they fully understand what they are agreeing to prior to the closing date.”

While the TILA-RESPA Integrated Disclosure is positive for all involved parties, its implementation has created some challenges for lenders and settlement agents. For buyers and sellers, the downside with the new rules is that loans will take longer to process.

“Real estate professionals and lenders need to set the right expectations with buyers,” said Alan Copertino, General Manager of Gibraltar Title Services. “Lenders will require more time to process mortgages. This will result in longer periods between contract and closing, typically 45 to 60 days.”

Additionally, the new rules give all-cash buyers who are not dependent on bank financing an advantage in a hot or competitive real estate market.

More than ever, buyers and sellers need a team of expert professionals in today’s real estate market. Berkshire Hathaway HomeServices Florida Network Realty Realtors are trusted advisors and valued business resources – it is what differentiates the company from the market competition.

The company’s agents have spent months preparing for the new TILA-RESPA Integrated Disclosure Rule, undergoing Gibraltar Title Services sponsored training programs and developing plans with lenders and title agents.

Berkshire Hathaway HomeServices Florida Network Realty is a partner of Gibraltar Title Services, which provides title insurance and real estate closing services for its clients. Gibraltar Title’s professional staff has extensive real estate and closing experience. The company provides loan closing services to many lenders doing business throughout the nation and is an agent for a number of major title insurance companies. Connect with the best at www.FloridaNetworkRealty.com.