Well, it’s almost that time of year. Close finishes. Drama. Late heroics. Bubbles bursting for many of the unlucky…
That’s right. It’s almost time for TRID Madness!
Why? Is something else going on in the near future?
August isn’t far away, and there’s some real concern out there about who will be ready for the new TILA-RESPA Integrated Disclosure rule (TRID)…and who won’t. Many of us remember the chaos (mostly on the settlement side, but not entirely) caused by the form change for the HUD-1 in 2010. ”Hiccup” is probably too mild a word for what ensued in the months after the new forms were mandated. But what happened over that frantic period will likely be nothing compared to what could take place after August this year.
Although we’ve heard that the biggest of the big are pretty much ready, and that much of the title industry has been moving on this for awhile, August will reveal which “solutions” work…and which don’t. But when I hear that a good number of businesses on both sides of the transaction haven’t even started testing their systems yet, well, I wonder how August will go. It appears that many didn’t truly realize that this is (and I apologize if you’ve heard this before, but it’s true) NOT a forms change. This is a process change, which will require the businesses making the mortgage come to reality to collaborate in one way, shape or form. This is new stuff.
On top of this, lurking in the background, we have a regulatory and enforcement entity which, to date, has shown little inclination to give the housing industry the benefit of the doubt or a mulligan on mistakes. This ratchets up the tension that much more…so much so that some lenders are privately conceding that if they’re not ready in August, they’ll put a moratorium on mortgage loans until they are. We’ve known since 2010 that big changes were around the corner for our industry. We’ve talked about it and talked about it. Well, it’s here. QM, it appears, was just a tremor…a bit of foreshadowing for what we’re probably about to feel.
Here’s hoping those who have taken TRID lightly don’t find themselves kicked out of the dance too early.