TRID, which stands for TILA-RESPA Integrated Disclosure, refers to new guidelines that streamline the loan disclosure process for consumers in real estate transactions. Implemented on October 3, 2015, TRID combines disclosures required by the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA) into two forms to make it easier for consumers to understand and compare mortgage options.
TRID introduces two main forms: the Loan Estimate and the Closing Disclosure. The Loan Estimate, provided to borrowers within three business days of submitting a mortgage application, outlines the key terms, projected payments, and closing costs of the mortgage. The Closing Disclosure, given at least three business days before closing, provides final details about the mortgage terms, monthly payments, and total closing costs.
TRID aims to enhance consumer protection by ensuring borrowers have ample time to review their loan terms and costs. It has brought significant changes to the mortgage process, mandating lenders to be more transparent and detailed in their disclosures, and allowing borrowers more time to review these documents.
For borrowers, TRID means more clarity in understanding mortgage terms, costs, and risks. It ensures borrowers receive consistent information at both the beginning and end of the mortgage process, facilitating better decision-making in one of the most significant financial commitments of their lives.
As part of responsible borrowing, it's crucial for prospective homeowners to be familiar with these forms and understand the details they contain.