What?
The new Truth in Lending Act/Real Estate Settlement Procedures Act Integrated Disclosure (TRID) rules were effective on October 3, 2015. Many lenders scrambled to master the details of the new disclosures. Construction loans were particularly difficult because of a lack of binding clarification of the requirements. But help has arrived.
On July 28, 2016, the Consumer Financial Protection Bureau (CFPB) published proposed rules to clarify the TRID rules for construction loans. Final rules were published on July 7, 2017. The final rules are effective on October 10, 2017 and compliance is mandatory on October 1, 2018.
Prior to TRID many construction loans were exempt from the old disclosure requirements, but TRID clearly expanded the scope of Regulation Z to cover most construction loans.
Initially, the CFPB provided few details regarding completion of the Loan Estimate and the Closing Disclosures for these loans. The most recent revisions clarify many lingering forms issues. Unfortunately, the regulation still does not contain sample forms for construction loans.
Why?
The program and the program materials, which are completely updated for the revisions that were mandatory on October 1, 2018, provide an update on regulatory guidance for construction loans.
The program explains coverage and exemption rules and provides section-by-section guidance on completing the Loan Estimate and the Closing Disclosure for the most typical construction loan options. Numerous form samples are provided. The program provides answers for the many questions bankers have regarding the proper disclosure of construction loans.