With its complicated legalities and taxing paperwork, closing a deal on a home can be stressful at any time. But October 1, a new rule goes into effect that some feel may complicate the process even further.
Handed down from the Consumer Financial Protection Bureau, the new rule changes the forms required during a closing. The new forms are meant to help consumers better understand the key terms of a mortgage and its associated costs, and to more easily compare different loan offerings. They also eliminate duplication that has proved puzzling for many consumers in the past.
While the change should ultimately benefit consumers, real estate agents and lenders are bracing for what they feel will be a difficult transition period. They are particularly concerned about two other new rules that take effect, along with the change in paperwork: a requirement that all forms be ready and reviewed by the buyer three days prior to closing, and one that requires another possible three-day waiting period, if any changes are made at closing.
If extra time is needed for either reason, this can mean some potentially stressful situations for buyers and sellers. Real Estate Insider offers a few possible scenarios:
- A buyer or seller who needs to close by a certain date to take advantage of a tax break may then lose that benefit.
- “A buyer who is already strapped for cash (might be) forced to find a short-term rental while waiting for the closing.”
- A buyer could lose a lock on a favorable interest-rate due to the delay, “leading to a new round of paper work, more delays and even more expense if rates increased.”
If you’re planning a closing in the fall, be sure you thoroughly discuss this change with your real estate agent and lender to know what’s ahead. Call us and we will be happy to walk you through the new requirements at any time and help you prepare for all contingencies.
Browse the newest Denver real estate listings below or click here to create your own search.