Highlights from the proposed TRID amendments

Recently the CFPB released proposed amendments to TRID. While the majority of the 293 page document consisted of clarification on existing TRID rules and regulations within the Final Rule there were also some notable sections that stood out:

The first would create a tolerance for the total of payment calculation. Before the Know Before You Owe mortgage disclosure rule, the total of payments disclosure was determined using the finance charge as part of the calculation. TRID changed the total of payments calculation so that it did not make specific use of the finance charge. The Bureau is now proposing to include tolerance provisions for the total of payments that parallel existing tolerances for the finance charge and disclosures affected by the finance charge.

The second would exclude recording fees and transfer taxes from the one percent fee limit that applies to the TRID rule exemption for down payment assistance and similar subordinate lien loans often made by housing finance agencies, non-profits, and similar entities. The Bureau’s proposed update would promote housing assistance lending by clarifying that recording fees and transfer taxes may be charged in connection with those transactions without losing eligibility for the partial exemption, and would exclude recording fees and transfer taxes from the exemption’s limits on costs.

The third looks to include units in a cooperative under TRID. Currently, the rule only covers transactions secured by real property, as defined under state law. Co-ops are sometimes treated as personal property under state law and sometimes as real property. By including all cooperatives in the rule, the Bureau would simplify compliance.

Lastly, the fourth clarifies how a creditor may provide separate Closing Disclosures to the consumer and the seller through the removal of information that raises privacy concerns. “The Bureau understands that it is usual, accepted, and appropriate for creditors and settlement agents to provide a closing disclosure to consumers, sellers, and their real estate brokers or other agents. The Bureau is proposing additional commentary to clarify how a creditor may provide separate disclosure forms to the consumer and the seller.”

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