The chief executive of one of the world’s largest real estate companies has called on the head of the Consumer Financial Protection Bureau (CFPB) to request a “good faith grace period” for the introduction of new TILA-RESPA Integrated Disclosure (TRID) regulations.
In a letter (see below) to CFPB Director Richard Cordray, RE/MAX CEO and co-founder Dave Liniger urged that the bureau refrain from enforcement of the new TRID regulations from Aug. 1, 2015 (when the regulations take effect) to Dec. 31, 2015. Liniger, who noted that his company represented “more than 57,000 U.S. real estate agents and the hundreds of thousands of consumers they work with each year,” stated that many homebuyers may be unaware or confused by the significant changes brought about the TRID regulations.
“Since the TRID regulation involves a totally new process that has never been tested before, we believe it would be more than appropriate to provide the industry with a grace period, which is entirely consistent with the introduction of previous RESPA disclosures,” Liniger wrote. “At the height of the homebuying season, it’s critical that we do everything possible to reduce the disruption that will surely result from such sweeping change. TRID is a complex regulation that involves timelines, disclosures, procedures and forms that have never been used before. Undoubtedly, the transition will also cause significant confusion for the homebuying consumer, the very individuals TRID has been designed to assist.”
Liniger added that “Over 15 industry associations and two congressional representatives” made similar requests to the CFPB for a TRID grace period.
Cordray did not publicly comment on Liniger’s letter, but in a speech delivered yesterday before the National Association of Realtors (NAR), he acknowledged concerns raised on the implementation of the TRID regulations without offering a hint that any grace period would be enacted.
“All of our hard work with industry is reflected in what we are now hearing, which is that most market players have put themselves in position to be ready by August, and others are getting ready as well,” Cordray said. “Yet we continue to receive a great deal of input on this issue, and as always we are listening closely in order to consider and assess that input.”
Liniger's letter is as follows:
Director Cordray:
Executives from our organization have met with CFPB staff on a couple occasions to discuss the impact of implementing the TILA-RESPA Integrated Disclosure (TRID) regulation. We are grateful for their openness and cooperation to help us understand the many aspects of this new regulation that are set to go into effect on August 1.
Representing over 57,000 U.S. real estate agents and the hundreds of thousands of consumers they work with each year, we are respectfully requesting that the CFPB consider a "good faith grace period" from August 1 to December 31, a sufficient time for the industry to learn the new system without the fear of enforcement, liability of litigation.
Since the TRID regulation involves a totally new process that has never been tested before, we believe it would be more than appropriate to provide the industry with a grace period, which is entirely consistent with the introduction of previous RESPA disclosures. At the height of the home-buying season, it's critical that we do everything possible to reduce the disruption that will surely result from such sweeping change.
TRID is a complex regulation that involves timelines, disclosures, procedures and forms that have never been used before. Undoubtedly, the transition will also cause significant confusion for the home-buying consumer, the very individuals TRID has been designed to assist.
We are pleased to be aligned with over 15 industry associations and two congressional representatives who have also requested such a grace period, and hope the CFPB will respond favorably to our recommendation. It's our strong belief that a "good faith grace period" will benefit everyone involved.
We appreciate your thoughtful consideration of our request and would certainly look forward to an opportunity to meet with you or your staff to discuss the issue further.
Respectfully,
Dave Liniger
Chief Executive Officer
RE/MAX, LLC
