The new TRID rules and forms took effect on October 3, 2015. The TRID rules are a result of the the Consumer Financial Protection Bureau (CFPB) integrated the Real Estate Settlement Procedures Act (RESPA) and Truth in Lending Act (TILA), and were put in place to add consumer protections to the mortgage lending process. The best laid plans…
I am one not to shy from telling the truth about the housing demand from mortgage buyers being soft this cycle. However, the existing home sales miss we saw today was primarily due to TRID.
We saw the drama earlier in October in purchase applications. Many people wanted to get their applications signed before the October 3rd deadline, pushing demand up.
Then the week after the deadline we saw a decline in applications, and this was due to TRID.
As we can see in today’s report, TRID significantly impacted the timing of sales.
NAR Report: http://www.realtor.org/news-releases/2015/12/existing-home-sales-suffer-setback-in-november-fall-to-slowest-pace-since-april-2014
I expect sales to rebound to a degree next month, as delayed deals close. A lot economic noise due to TRID. But TRID will continue to delay some sales until April of 2016. By then we should see a more fluent loan process and fewer delays.
TRID will cause delays but it is not the reason existing homes sales from mortgage buyers is still soft. If not for the expansion of cash buyers in this cycle, headline numbers for existing home sales would be worse.
Still even with this big miss in existing home sales today, we will see growth year over year as mortgage buyers grew in 2015.
For a more detail report on 2015 Existing Home Sales.
2015 Existing Home Sales Report Card:
Merry Christmas & Happy Holidays everyone!
Logan Mohtashami is a senior loan officer at AMC Lending Group, which has been providing mortgage services for California residents since 1988 and is in a partnership with ZeneHome.com