“A grace period is something the industry needs; it would be a shame if someone acting in good faith messes up and is penalized,” Attorney Marc Israel told MortgageBrokerNews.ca. “They need to give originators a few months to work in live action.”
Israel, who is also president and chief counsel for MiT National Land Services, teaches a course to lawyers on TRID preparedness. That experience has convinced him of the need for a grace period.
According to Israel, one of his classes contained 45 real estate lawyers who each close between 1,500 and 2,000 deals per year. And these professionals raised questions about potential deal snags that have yet to be answered.
“I could barely go five minutes without someone asking what would happen in X,Y,Z situation,” Israel said. “In a lot of the cases they were issues that aren’t touched upon in the legislation.”
Theory is one thing; practice is another.
And that is why the industry needs a grace period, Israel says.
“The problem I have is the new regulation is contained in legislature that is around 1,800 pages long; and while the regulators think they may have taken everything into account, things are different on an actual deal,” he said.
However, the White House has said it plans on vetoing the recently passed bill H.R. 3192, which would provide a formalized hold harmless period until February 2016. And Israel doesn’t understand that.
“I can’t for the life of me figure out what the White House is thinking,” he said.
The industry can make all the preparations but, when it comes down to it, a grace period to properly acclimatize is needed, says one professional.