Major changes to the way real estate transactions are conducted will be instituted, possibly as early as Aug. 1. Transactions involving a mortgage will require new disclosure forms created by the Consumer Financial Protection Bureau.

The Truth-in-Lending Act and the Real Estate Settlement Procedures Act, TRID, set strict deadlines for disclosures that lenders need to provide to consumers. For example, lenders can be held liable if certain costs exceed limits set forth in the lending act. Also, if changes occur too close to the closing date, a sale may be postponed.

Consumers contemplating obtaining a loan should meet with a lender early in the process because the amount of documentation required can be overwhelming and time-consuming to gather.

Through the Dodd-Frank Act, Congress enacted the Truth-in-Lending Act to improve what loan information must be made to consumers.

A loan estimate is needed when consumers apply for a loan. Other than charging for the credit report, a lender cannot charge a fee until after a consumer has received a loan estimate and has decided to proceed. Lenders must send the estimate within three business days after receiving an application, and the final estimate must be issued at least seven business days before the closing. A consumer has 10 business days after getting a loan estimate to decide whether to proceed with the transaction. The consumer must receive the closing disclosure information within three business days of closing.

The disclosure details all of the costs that will be paid by the consumer and includes any alterations made at the closing table.

If there were three or more changes made during the closing process, a new closing disclosure must be issued, and the consumer will have another three days to review the disclosure.

Prior to listing a home, real estate agents often recommend a pre-listing home inspection requiring the seller to get an inspection before listing the home. Inspection issues cause complications for sellers and buyers. Resolving these issues early helps the contract timeline move along without potential delays.

Assume 45 to 60 days for contract closings. Consumers can prevent delays by meeting with a lender early and conducting a pre-listing inspection. Last-minute negotiations could derail the closing.

Kelly Kniffin is a Realtor at Legacy Properties West Sotheby’s International Realty and a past president of the Durango Area Association of Realtors. She can be reached at Kelly@homesdurangoco.com.