TRID which stands for TILA/RESPA Integrated Disclosure Rule is also known as the “know before you owe” rule. This new rule that was implemented on October 3, 2015 is designed to help and protect people that borrow money and includes homebuyers that are getting mortgages.
This was inspired by the carnage that came out of the 2008 financial crisis where thousands of people were forced to abandon their homes because they could no longer afford them or their mortgages were under water. An under water mortgage is when you owe more on your home than it is currently worth in the real estate market. Back then, many banks and lenders were lending money to anyone that wanted it because the rules were so lenient that it was hard to determine who ultimately would suffer if the homeowner could not pay for their home. Of course the home owner that lost their home suffered greatly, but the banks had such concocted such complicated schemes with their loans that the government had to step in and bail them out with tax payer’s money.
TRID makes sure that when you go to get a loan, that you will be crystal clear on how many fees you will be charged and exactly how much. You will also know how much you will be paying each month and how much interest you will be charged. Of course you as the individual that is borrowing the money need to take some responsibility and actually read the documents and understand them. If you have any questions you have three business days to have them answered.
TRID was designed to help the consumer and it should not delay your loan application. It only ensures that the loan officers or bank employees have to give you your loan information in advance of the loan being completed so that you have time to understand it. Make sure that you are working with a lender that has successfully closed a lot of real estate deals since TRID was implemented. There may be some lenders that are still bogged down in bureaucracy and could slow the home buying process down.
One lender that is ahead of the game is Amerifirst and they have a lot of great information and some very informative videos on their website at http://www.amerifirst.com/trid
For a more condensed explanation of what TRID will mean for you as a home buying process