Will Lenders Need a Week to Get Closing Docs In?
June 12, 2015
Big changes to the process and forms used in real estate closings are coming August 1 and many real estate professionals are wondering what it will take to ensure closings go smoothly in the new environment.
It falls to lenders to get a new closing disclosure form to buyers within a three-day time frame required by the Consumer Financial protection Bureau, which developed the new procedures and forms. But practitioners will play a key role in ensuring everyone is in communication to make the process go smoothly. Phil Schulman of K&L Gates in Washington, an expert on federal closing rules, says lenders will likely have to put the closing disclosure form into the mail at least a week before settlement to help ensure the three-day deadline is met. If that’s the case, all the information that goes into the closing disclosure, which replaces the HUD-1 settlement form, will have to be finalized more than a week before settlement, he says. Because lenders will have to use the U.S. Postal Service date stamp as verification of when they sent the form to the buyer.
You can learn more about the issue in NAR's latest news video, The Voice for Real Estate, which released yesterday.
The video covers other key news events, including NAR's latest pending home sales release, which says closings are at their highest level in nine years. NAR Chief Economist Lawrence Yun says the trend in pending sales indicates a strong year for sales even though interest rates are likely to tick up this fall. He says the increase in rates should be modest, so sales shouldn’t be impacted much.
Also, NAR just released its 2015 Member Profile, which looks at how real estate professionals are doing, where they get their business, and other trends of interest to the real estate industry. Among other things, the report found the typical real estate professional doing 11 transactions last year, down from 12 the previous year. It also found practitioners jumping into social media in a big way, with almost two-thirds using social media, twice as many from just a few years ago. And among younger real estate pros, social media use is up to 80 percent.
Updated: August 07, 2020