Although you may not be looking forward to the upcoming TRID changes, the truth of the matter is, you can’t avoid them. Non-compliance is a risk to the real-estate deals you’re facilitating, your practice, your reputation, and comes with some stiff penalties.
Some compliance issues won’t change under TRID. Others will. Here’s a look at both and what to expect if you don’t comply with the requirements.
What Doesn’t Change
One rule that has been in effect since 2010 is RESPA Regulation X. Failure to comply with this rule could lead to partial or full remediation of funds to the borrowers. How well your firm was able to comply with Regulation X is a good indicator of how well you’ll fare under the new TRID changes.
Currently, there are five areas under TRID that could result in borrower remediation if compliance measures are not followed. Repercussions for non-compliance in these five areas don’t change, but could cost more. The five areas that put you at risk for non-compliance are:
1. being late with initial loan estimates,
2. providing inaccurate estimated fees,
3. failure to properly disclose changed fees,
4. changed circumstance disclosure timing, and
5. provision of the settlement services providers list
Now, chances are good that you’re already doing everything right to remain in compliance on these issues. So what you really have to worry about is what you’ll find in the section below.
What Does Change
Non-compliance in the five areas mentioned above will carry higher penalties once TRID goes into effect. Statutory and civil penalties and new rights for borrowers are the biggest changes, specifically:
- Borrowers will have the right to claim actual damages, statutory damages, court costs, and attorney’s fees.
- Statutory penalties can be as high as $4,000 if you don’t provide certain disclosures like the borrower’s interest rate and APR.
- First Tier civil penalties levied by the CFPB of as much as $5,000, per day, per violation are now possible.
- Second Tier civil penalties of up to $25,000 per day, per violation for reckless violations.
- Third Tier civil penalties of up to $1 million per day, per violation for knowing violations.
In addition to penalties and borrower remediation, there are other costs to consider:
- Violations of the Unfair, Deceptive, or Abusive Acts or Practices (UDAAP) rules could arise if there is failure to issue initial or subsequently required Loan Estimates in a timely fashion.
- Investors can now be subject to the same claims brought against the creditor, in some cases. Not only are there monetary risks to these claims, they also damage investor reputations.
No Risk Of Non-Compliance With Easy Soft’s Real Estate Closing Software On Your Side
As intimidating as this all sounds, technology can help. Easy Soft’s Easy HUD real estate closing software is already being updated to comply with the 2015 TRID changes. Very soon we expect to roll out our new EasyCDF software, which will be 100% compliant with the changes, protecting your business from all of these non-compliance issues, fines, and penalties.
Rather than invest in more labor to make sure your paperwork is in perfect order, invest in technology solutions that streamline the closing process, ensure compliance with new rules and regulations, and improve productivity. EasyCDF is that solution.
Contact Easy Soft today at 1-800-905-7638 to learn more about our EasyCDF software and how we’re working to make sure you remain compliant with the upcoming TRID changes.