As we first outlined to you last November, big changes are coming up in the Summer of 2015 on how your closings are going to take place, how the settlement statements will be delivered, and the new forms to be used by mortgage and settlement service providers starting on August 1st, 2015.
You may have noticed in the title that this is “Part I.” Between now and August 2015, we will publish every month another part of the series using our weekly Title Tip. Each serial will address a different change coming up. Our goal is that with this series along with the dedicated training we will provide next year as August approaches, you will have a seamless transition from HUD‐1 to Closing Disclosure. Let not your heart be troubled – we will be with you the entire way.
What do you need to know now about the changes? Well, first of all, you need to know they are coming next year. Second, know that we will make sure that every one of our customers – you – will have multiple opportunities to be trained on, understand, and have the tools you need to explain the new process and its settlement statement to your customers next Summer.
You will hear more and more of people in the industry using new terminology and definitions. Everyone will need to get comfortable with these, as they are what the Consumer Financial Protection Bureau ﴾CFPB﴿ will be using – and will expect everyone else to use. As words and their use are critical in understanding everything that follows, that is what we will focus on for this week’s Title Tip.
Here are the top‐six changes in terminology you will start to see:
‐ Old: HUD‐1. New: Closing Disclosure.
‐ Old: TILA & GFE. New: Loan Estimate.
‐ Old: Lender. New: Creditor.
‐ Old: Borrower. New: Consumer.
‐ Old: Tolerance. New: Variance.
‐ Old: Closing/Settlement. New: Consummation.
There has been some pushback on the term “consummation” for closing, but the CFPB insists on its use.
My expectation however, is that regardless of what the CFPB desires; the use of “closing” will most likely remain in use in the field.
I know many of you keep hard copies of our Title Tips, and if you don’t you may want to start. Make a section dedicated to the August 2015 Closing Disclosure series, and keep them together as new tips in the series come out so you have a handy reference.
In the meantime, if you hear any rumors or have questions, feel free to give me a call or send me an email.
You can get a PDF of this title tip here.
My Agent Greg 