GFE/HUD-1 Are NOT Extinct - merely deprecatedOf the many TRID change challenges, one curve ball that continues to confuse: GFE and HUD-1 still remain in use! TRID doesn't apply to all transaction - some retain the the GFE/HUD-1 process. Ensuring the correct disclosures at the right part of the process is an important component of compliance.
2010 GFE Process REMAINS IN PLACE
Your old GFE Process doesn't get deleted, it gets denigrated from a primary to a secondary process (depending on your business model). If your business focuses primarily on reverse mortgages, home equity lines of credit or mobile homes, your business continues as usual; the TRID process applies as secondary in the event you pick up a customer to which it applies. Also, business loans, farm loans, temporary financing, such as construction only loans, lot loans and conversions remain exempt.
Loan Estimate Process and Closing Disclosure Process
- The APR (annual percentage rate) increases by more than 1/8 of a percent for fixed-rate loans or 1/4 of a percent for adjustable loans. A decrease in APR will not require a new 3-day review if it is based on changes to interest rate or other fees.
- A prepayment penalty is added, making it expensive to refinance or sell.
- The basic loan product changes, such as a switch from fixed rate to adjustable interest rate or to a loan with interest-only payments.
Don't Forget the Home Loan Toolkit!!
The Home Loan Tool Kit replaces the "Settlement Costs Booklet" that we have been busy not giving to customers for the last 40 years. This is a foundational piece of the Know Before You Owe process. We have some problems with the information disseminated within the Tool Kit - specifically some mis-information with regard to locking in, but it generally represents a more customer friendly read and it references all of the other TRID material.
Your FREE Know Before You Owe Policy
Of course, remember we have been providing you with a FREE TRID policy since the beginning of the year. Now is the time to examine the easy way to manage your compliance policies and procedures with our Compliance VP Document Management System.