Changes to the Closing Process

On October 1st there will be changes made to the process of closing on a home. What changes exactly? To begin, there will be new forms that will be used during the process. Currently, the HUD-1 and Good Faith Estimate disclosure forms are used. However, these will soon be replaced with the Closing Disclosure and the Loan Estimate forms. Secondly, some new rules will be implemented. One rule requires that all forms must be ready three days before you close. However, NAR recommends that you have everything ready seven days prior to closing; this ensures that no changes will have to be made during the three-day period. Essentially there will be pressure to get everything done earlier. And in order to achieve an on-time closing, the CFPB (Consumer Financial Protection Bureau) will also be implementing a three-day waiting period for any last-minute changes made to the forms.

So, what are some ways to prepare for this big new change? For starters, NAR will be hosting many webinars on the topic. Also, we have until October to brush up on this new system, so take this opportunity to do plenty of research. Furthermore, relax, and take some time to learn about and adapt to this new process. While these new procedures put more pressure on Lenders and Title companies, it’s important that you (the buyer or seller) be well informed so that you can provide what you need to in order to close on time and that you are in constant communication with your agent, lender and title!

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