What an interesting summer it's been in real estate! Or maybe it's been an interesting credit market summer which has greatly impacted our real estate market. I seem to spend a good deal of time reassuring my buyer-clients that the third-degree experience they are receiving from their lenders isn't personal and that we just have to muddle through the myriad of requests that are being made for documents that they already provided. I'd say a good fifty percent of the transactions that I've been involved in recently haven't closed on time because of lending issues -- underwriting questions, appraisals, et cetera. When I started in real estate, I'd swear that if you could fog a mirror, you could get a loan! Obviously, those times have changed and we've swung way far to the other side of the pendulum and well-qualified buyers are even finding it difficult to persuade lending agencies of their credit-worthiness.
Tomorrow things can slow us down even more with new Regulation "Z" requirements:
New Truth in Lending Act (TILA) federal disclosure rules for lenders take effect tomorrow, July 30, and closings could take longer as a result. The changes to "Reg. Z" add borrower review periods and require lenders to notify borrowers of any annual percentage rate (APR) changes of more than 0.125 percent. Borrowers then get an additional review period.
That additional review period means longer closing times!
