{"id":1935,"date":"2015-05-13T18:05:40","date_gmt":"2015-05-13T22:05:40","guid":{"rendered":"http:\/\/dankrell.com\/blog\/?p=1935"},"modified":"2020-06-03T08:36:33","modified_gmt":"2020-06-03T12:36:33","slug":"new-settlement-rules-may-facilitate-much-needed-communication","status":"publish","type":"post","link":"https:\/\/dankrell.com\/blog\/2015\/05\/13\/new-settlement-rules-may-facilitate-much-needed-communication\/","title":{"rendered":"New settlement rules may facilitate much needed communication"},"content":{"rendered":"

\"homes\"<\/a>Signed into law July 21st<\/sup>, 2010, the Dodd\u2013Frank Wall Street Reform and Consumer Protection Act <\/a>(aka Dodd \u2013 Frank) was intended to improve accountability and transparency in the financial system, to protect consumers from abusive financial services practices, and to end \u201ctoo big to fail.\u201d The Act created the Consumer Financial Protection Bureau, which enforces regulations to protect consumers and implements rules such as the Qualified Residential Mortgage (also mandated by Dodd \u2013 Frank).<\/p>\n

Five years after enactment, Dodd \u2013 Frank seems to be the Act the keeps on giving with the upcoming implantation of Sec 1098; which states that the Consumer Financial Protection Bureau (CFPB)<\/a> \u201cshall publish a single, integrated disclosure for mortgage loan transactions\u201d<\/em> in a \u201creadily<\/em> understandable language<\/em>\u201d so as to help borrowers understand the financial aspects of their loan clearly and to be nontechnical.<\/p>\n

The new disclosure and settlement statement <\/a> is intended to present important information conspicuously to help consumers decide if the mortgage is affordable and give warning about undesirable loan features. The new forms seek to standardize fee and cost disclosures so as to make shopping for a mortgage easier. One of the more important aspects of the new regulation is that the new Closing Disclosure<\/a> is to be given to the borrower at least three days prior to settlement. During the three days prior to closing, changes to the Closing Disclosure that increase charges are prohibited (unless allowed by exception).<\/p>\n

Firm timelines for closing and mortgage associated matters, have always been a crucial aspect of the home purchase contract. Not adhering to the dates specified in the contract usually has consequences. However, changes to Realtor\u00ae contracts are being considered to reflect the three day waiting period. What was once a firm timeline may no longer have the \u201ctime is of the essence\u201d feel, as future contract revisions may not hold the buyer in breach of contract if the home does not close by contract settlement date. Carryover issues may also include implications to meeting loan commitment and appraisal contingency timelines.<\/p>\n

If you\u2019re buying a home, note that there are a number of situations that could cause your closing date to be rescheduled because of a \u201creset\u201d to the three day waiting period, including a loan product changes, 1\/8% increase in APR, and\/or there is an added pre-payment penalty.\u00a0\u00a0 Additionally, other lender actions may also require you to reschedule closing; such as a lender required repair with reinspection.<\/p>\n

Many in the industry are also concerned about routine buyer and agent pre-settlement walkthroughs. Rather than prior to closing, they will have to be scheduled to allow for negotiation on potential issues without resetting the three day waiting period (and cross your fingers that nothing happens to the home the three days prior to closing).<\/p>\n

However, CFPB Director Richard Cordray was quoted emphasizing \u201cThe timing of the closing date is not going to change based on the final walk-through\u2026\u201d in a National Association of Realtors\u00ae (realtor.org) May 12th<\/sup> press release reporting on speakers at a regulatory issues forum<\/a>.<\/p>\n

The complexity and implications of the new regulations will undoubtedly cause some confusion in the first days of implementation. However, the new rules inadvertently address one of the weak links to the real estate transaction \u2013 communication<\/a>. Many are beginning to recognize the necessity for everyone involved in the transaction to be proactive and communicate with each other to ensure compliance.<\/p>\n

\"Protected<\/a>
\nDisclaimer<\/a>. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.<\/p>\n","protected":false},"excerpt":{"rendered":"

Signed into law July 21st, 2010, the Dodd\u2013Frank Wall Street Reform and Consumer Protection Act (aka Dodd \u2013 Frank) was intended to improve accountability and transparency in the financial system, to protect consumers from abusive financial services practices, and to end \u201ctoo big to fail.\u201d The Act created the Consumer Financial Protection Bureau, which enforces … <\/p>\n

Continue reading “New settlement rules may facilitate much needed communication”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[433,270,13,41],"tags":[724,490,511,797,815,773],"class_list":["post-1935","post","type-post","status-publish","format-standard","hentry","category-consumer-financial-protection-bureau","category-home-buyer","category-real-estate","category-settlement","tag-cfpb","tag-home-buyer-2","tag-home-buying-process","tag-real-estate","tag-settlement","tag-settlement-disclosure"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p1VZLf-vd","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"jetpack_likes_enabled":true,"_links":{"self":[{"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/posts\/1935","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/comments?post=1935"}],"version-history":[{"count":6,"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/posts\/1935\/revisions"}],"predecessor-version":[{"id":5993,"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/posts\/1935\/revisions\/5993"}],"wp:attachment":[{"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/media?parent=1935"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/categories?post=1935"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/tags?post=1935"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}