What real estate agents need to know to ensure a smooth closing for their clients.
“Real estate agents need to be ready for this—this is a game-changer,” Joe Taylor said of a new law, effective October 3, 2015 that will drastically affect the real estate industry. As President of Marketplace Title in Estero and Cape Coral, Taylor has spent the last year following the development of TILA-RESPA, which combines mortgage disclosures under the Real Estate Settlement Procedures Act (RESPA) and the Truth in Lending Act (TILA) into a single rule. That’s a mouthful, but it’s all intended to provide an easier borrowing process for the consumer. Real estate agents, however, need to get up to speed quickly. Marketplace Title is pleased to offer a free one-and-a-half-hour class to help real estate agents successfully represent their clients and avoid costly closing delays.
The new TILA-RESPA Integrated Disclosure law will be regulated and enforced by the Consumer Finance Protection Bureau. It is supposed to streamline the mortgage process for consumers and hold lenders more accountable in real estate transactions. Many key items will be addressed: First, during the loan application process the Good Faith Estimate and Truth-in-Lending (TIL) form will be combined and replaced by a new three-page form called the Loan Estimate. Next, the HUD settlement statement and the final TIL will be combined and replaced by a new five-page form called the Closing Disclosure. A third, and extremely important, change is that the lender is responsible for delivering the Closing Disclosure to the Borrower three business days before the closing AND is responsible for any errors from third-party agencies such as title companies, appraisers and credit reporting bureaus. “Three business days?” Taylor exclaimed. “Title companies are lucky to get the final figures from the lender the day of closing!” Finally, any change in loan product or APR or the addition of a prepayment penalty will all have to be re-disclosed, prompting the three-business-day clock to restart.
In representing real estate agents, buyers, and sellers, Marketplace Title works to ensure a smooth transaction every time. “We want to make sure we provide peace of mind for everyone involved,” Taylor explained. “We want to be the resource that real estate agents come to for help in understanding and properly explaining the new law to their clients.”
In that spirit, the Marketplace Title’s TILA-RESPA class, one of the free offerings in its popular Real Estate Success Series, will help real estate professionals properly plan their closings and effectively communicate with their clients to ensure greater success.
“Without the proper understanding and use of the regulations set forth in TILA-RESPA, lenders will see massively increasing fines being levied and delays in closings taking place,” Taylor said.
Real estate agents also need to make sure they use a reputable title company. Since lenders are now going to be held more responsible for the closing, a title company that is above reproach is a must. Lenders are starting to vet title companies closely to make sure they lessen their risk. Marketplace Title consistently exceeds the necessary standards set forth in the industry.
Taylor said, “This law is all about protecting the consumer, and we will do all we need to do to make sure we follow the best practices set forth by the American Land Title Association. We want to make sure the consumer gets what they have earned and deserve.” That’s why it makes sense for Marketplace Title to offer the Real Estate Success Series, to help real estate professionals advocate effectively for their clients while understanding the complexities of the new rule. Call (239) 333-4550 or visit fltitles.com for more information.
Published in the July 2015 issue of the Estero Spotlight Magazine and written by Sara Fitzpatrick Comito.