Those changes came in the form of a resolution put in place to help home buyers that emanated from the home ownership fallout of the great recession.
In short, the government wanted to make it easier for people to understand what it cost to buy a home.
The Act got off to a bad start when they called it the TILA-RESPA Integrated Disclosure, which can be broken down further into two additional acronyms. For short, it’s called “TRID” or “Know Before You Owe.”
The mandate is that lenders must give a home buyer an accurate breakdown, written in plain, jargon-free English, of every penny they’ll owe on their new mortgage every month.
The problem is, the process remains unpredictable.
A recent survey conducted by ClosingCorp, a data company that covers real estate, showed that estimate problems persist and closings are being delayed.
Fifty-eight percent of the 1,000 home buyers surveyed reported their payment estimates had to be revised before closing.
The changes revolved around insurance costs, closing fees, and taxes. It was also cited that adjustments to loan amount qualification resulted in changes.
We think a healthy percentage of those adjustments can be attributed to general human error. It’s not uncommon in the numbers-heavy, often poorly communicated process that is a home closing.
At Century 21 Gavish Real Estate, we work tirelessly to ensure our clients are aware of every speedbump coming their way—and there always are a few.
The issue with TRID is that it tried to formalize a process that agents were already good about handling.
By adding legal parameters, Washington created a new, even larger speedbump that gives birth to countless others. It’s a self-perpetuating, error-prone squid of confusion.
We totally agree with its intent—home buying should be as easy as possible.
However, it should be left up to the industry’s practitioners to manage. The home buying process itself was never at issue, closings were explained clearly and customers are led hand-in-hand through the closing.
For many real estate agents, TRID is a reactionary, bloated precaution that came too late.
Of course, let’s give it time. Again, if the goal is to improve the happiness of those who want to buy a home, we’re all for it.
However, we hope that our lawmakers recognize when it’s time for a revision. It may not be long.