How Has Tighter Industry Regulation Changed the Home Buying Process?


In place for over a year now, the TILA-RESPA Integrated Disclosure (TRID) rule set forth by the Consumer Financial Protection Bureau has certainly impacted the process of buying real estate. The intent of tightening regulations within the mortgage industry was meant to streamline and simplify the process for home buyers, while reducing the paper count and confusion of residential real estate purchases in previous years.

Here’s a closer look at how stricter regulation in the mortgage industry has affected the process of buying a home.

From the Home Buyer’s Perspective

  • Changes to settlement forms. Lenders are now required to provide more detailed, thorough information surrounding the mortgage loan to home buyers prior to closing, which is largely accomplished through the Closing Disclosure Form (replacing the HUD-1). Such changes better enable consumers to understand their risks and costs associated with taking on a mortgage.
  • Enhanced awareness of mortgage terms. Though the pre-approval process is relatively the same, borrowers are now more aware of the terms of their mortgage, generating less confusion and fewer surprises at the closing table. TRID mandates that home buyers receive a copy of the Closing Disclosure Form for review at least three days prior to closing.
  • Time to settlement. With TRID, the timeframe between contract and close has increased slightly, though overall, no major impact has been experienced. In general, purchasers have fewer questions at the closing table resulting from enhanced understanding of mortgage details.

Thanks to TRID, the explanation and interpretation of often complicated mortgage information has rendered residential real estate purchasers better informed about their mortgage responsibilities. In fact, all parties involved in the real estate transaction now typically experience a congruence throughout the process, right through to the day of closing. For questions or concerns regarding real estate settlement, contact Linear Title & Escrow at (757) 340.0340 today.



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