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Starting October 1, there are going to be significant changes in the way real estate transactions are closed. In today's video, I'll focus on the high and low aspects of these changes.
First of all, the closing statements are going to change. If you've purchased a home in the past and were confused by HUD, I can assure you, you were not the only one. HUD will be replaced by the closing disclosure, which is the easiest closing document I have ever seen. It details all the expenses involved in the transaction so purchasers know exactly what they are looking at. This will be a great improvement for buyers.
On the other hand, closing dates could become moving targets. The Consumer Financial Protection Bureau has decided to give the buyer a three-day cooling off period from the acknowledgement of receipt for the documents from the lending company. If the buyer does not acknowledge receipt, that could delay closing even longer.
I think the days of 30 day closing periods are over. Due to these changes, we will probably move to 45 or 60 day closing periods as time goes on. After the mortgage companies get used to these systems, maybe it can be refined in order to get back to 30 day closings. However, I don't see this happening in the first year after these changes take place. The new closing period could cost buyers and sellers thousands of dollars, simply because sellers schedule their movers for a particular day and buyers may need to be out of a lease on a particular day.
Aside from the closing date issue, I think this is going to be a great system. If you have any questions on these changes, you can subscribe to our newspaper. Just give me a call or shoot me an email. I'd be happy to answer any questions you may have.
