RESPA 3 Day Waiting Period
The Consumer Financial Protection Bureau (CFPB) listened to NAR in producing the new RESPA/TILA rule. NAR had argued for nearly three years that CFPB should focus on harmonizing the upfront disclosures, the Good Faith Estimate (GFE) and the Truth in Lending disclosure (TIL) and not fundamentally change the settlement process by implementing a broad 3 day waiting period when there are changes to the closing disclosure (Today’s HUD – 1). CFPB essentially maintained the TILA aspects of the three day waiting period- requiring a new disclosure and tolling period if the Annual Percentage Rate (APR) changed by one eighth of a point, if the loan type changes, or other significant changes to the loan itself like if a prepayment penalty is added. This is a major change from what was proposed where even minor changes to the closing documents could have required a new three day waiting period. NAR continues to work with CFPB to fine tune the rule and obtain guidance and will be working to educate members as well. The rule becomes effection in August of 2015.