TRID Tips from the Trenches

DENVER, Colo., May 5, 2016 — In my role as an operations manager for the last 25+ years — and having been an industry participant since before APR became an inexplicable fact of life — I have acquired quite the historical perspective on compliance regulations and implementation. I currently manage operations for an outsourcing provider where we are shoulder-to-shoulder with our clients in the trenches.

Early feedback from our processing and closing staff, recent confirmed closing delays related to TRID and documented evidence of high TRID compliance fail rates in closed loans have compelled me to share some observations and insights. Our staff is working with companies who are totally buttoned-up, but they did initially struggle with the changes required of TRID. A variety of problems were seen at the time the files arrived in closing, but three factors were common, individually or in combination:

Errors and omissions on the initial LE or subsequent LEs
Changes made to LEs without a valid Change of Circumstance, and
Initial CDs sent out before the file was properly reviewed and reconciled in order to start the three-day clock (in some cases, the initial CD was sent before the file was clear to close).

As we worked jointly to remediate these early challenges, we learned lessons I would like to share with others who may still be struggling:

  • Access must be strictly controlled so that any staff member touching an LE or CD thoroughly understands the details of TRID regulation.
  • TRID has brought a level of complexity that makes the very best software and flows secondary to the human intelligence needed to properly analyze, manage and input the data. Expecting templates and software to do the heavy lifting proved inadequate in itself.
  • Extreme diligence and care must be taken with the initial LE. The level of detail must equal that of the final CD. Sales teams must get on board with this necessity and provide terms and fees accordingly. Shortcuts at this stage can be costly in every way imaginable.

In sum, detailed policies and procedures must be put in place to drive TRID compliance throughout the entire operation, and hard stops must actually be enforced when necessary — even when it hurts. The good news is, we’ve seen first-hand from our clients that our industry can do this!