The new mortgage settlement requirements have failed to disrupt the market as expected, at least as far as real estate agents are concerned, thanks in large part to diligent preparation.
"It's been a non-event," Lawrence Yun, chief economist at the National Association of Realtors, said this month at the group's annual convention in San Diego. "Realtors are a vocal bunch. They will tell us immediately if something is wrong...but so far, we haven't heard much at all."
Earlier in the day, Karen Crowson, chair of the Realtor group's regulatory issues forum, said the same. "Loans are closing with very little disruption."
Known as the TILA-RESPA Integrated Disclosure, or TRID, the new rules combine the old Truth-in-Lending and HUD-1 disclosure forms into one and change the traditional timing of those notices to consumers. Many feared the regulation would cause problems because employees would have to be retrained and computer programs redone.
The 1.1 million member Realtor group is taking much of the credit for what at worst have been only "minimal" delays, citing months of preparation and training offered to its members.
"Realtors worked hard to get themselves educated about and ready for 'know before you owe,'" said Chris Polychron, the president of the Realtor group and a broker in Hot Springs, Ark., referring to the new rules promulgated by the Consumer Financial Protection Bureau. "That work seems to be paying off," he said.
"We are pleased that closing delays...have been few in number so far," Polychron said.
Maria Lau, sales division manager at Waco Title in Texas, said she has conducted some 70 classes for 2,300 realty agents over the past year.
"It's been an interesting year, an interesting ride," Lau said. "A lot of people are in denial. Loans are closing. Some go out a little further, but we're still here. We'll get through it."
Lau said she cautioned patience in her classes, and agents in her market have followed her advice.
Don Chiesa, vice president of national loan production at Quicken Loans, said he has seen "only a minimal amount of added times" to the 3,800 loans his company has closed since the new disclosure rule took effect Oct. 3.
Ninety percent of Quicken's 1,000-person technology support staff has devoted time over the past year to the new rule. But the effort has paid off for the Detroit-based lender.
"It's worked," Chiesa said during a regulatory issues forum at the Realtor conference.
Anthony Lamacchio, a broker and owner of Lamacchio Realty in Waltham, Mass., said the new rule has been good for agents and their clients.
"Not many agents enjoy it when their buyers are freaking out the night before closing" when they don't know how much money to bring to closing or when the amount is far different from what they were told originally.
"Three years ago, I thought this was just another government rule," he said. "But I started to realize this is going to be good."
Lamacchio said he was "happy to see" that the CFPB did not delay the rule beyond Oct. 3, as some in the lending community had wanted. "It was time to jump in," he said.
He also said he's "happy" with the way things are going so far. "There are maybe some delays, but it will be well worth it," he said.
Lew Sichelman is an independent journalist who has been covering the housing sector for nearly 50 years.
