The banking industry has spent the last two years preparing for the Consumer Protection Financial Bureau’s implementation of the Truth-in-Lending Act (TILA)/Real Estate Settlement Procedures Act (RESPA) Integrated Mortgage Disclosures Rule – referred to by the acronym “TRID.” (78 FR 79730). TRID was scheduled to become effective on August 1, 2015 by implementing significant changes for lenders providing disclosures to consumers who are applying for, and closing, a mortgage loan. TRID modifies three decades of federal law by changing the timing and format of disclosures made during the mortgage process. A key change under TRID is the requirement that two new consumer forms be used for the mortgage transaction (replacing four forms used under the old TILA/RESPA regime) – the new forms are the Loan Estimate and the Closing Disclosure.Acting under a mandate contained within the Dodd-Frank Act, the CFPB issued the final TRID rule in November 2013. Satellite images The CFPB’s stated purpose for TRID was to “combine two existing disclosure regimes under TILA and RESPA and make mortgage disclosure easier for consumers to understand and use.” Despite repeated request to delay TRID’s implementation date, the CFPB had refused to postpone the rule’s effective date.
However, on June 17, 2015, the CFPB’s Director reversed course — citing an “administrative error” and consumers’ busy schedules during the start of a new school year – and issued a statement proposing to delay TRID’s effective date until October 1, 2015. The proposed postponement is not final until publication and public comment but, it appears, that lenders will be given a two-month reprieve on TRID’s effective date.