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This TRID (TILA-RESPA Integrated Disclosure) summary provides an overview of buyer/seller CDs and disclosure to real estate professionals.
Lenders may issue a single CD for the buyer and seller or require a settlement agent to prepare a separate seller CD.
- Under TRID, lenders are not required to have the seller receive the same version of the CD that the buyer receives.
- The settlement agent is permitted to provide the seller with a separate CD that contains only the information applicable to the seller’s transaction.
Privacy laws impact how lenders disclose buyer and seller information on the CD.
- The Gramm-Leach-Bliley Act (“GLBA”) and implementing Regulation P govern the privacy practices of financial institutions and include exceptions that permit, but not require, lenders to disclose buyer’s personal information.
- However, lenders may instead follow TRID to protect buyer’s personal information by separating the buyer and seller CDs.
- State financial privacy laws generally mirror the GLBA, but may be more stringent and require lenders to separate buyer and seller information on two CDs to protect personal information.
An agent may receive a copy of their client’s CD, but not necessarily a copy of the other party’s CD, when separate CDs are issued.
- The GLBA permits a lender to provide personal information to a consumer’s agent in a transaction (i.e. lender or settlement agent can provide the buyer’s CD to the buyer’s agent or the seller’s CD to the seller’s agent).
- However, if a lender is concerned that GLBA exceptions do not clearly authorize it to disclose a buyer’s transaction information to the seller, the lender will likely not allow the buyer’s CD to go to the seller’s real estate agent.
- In transactions where buyers and sellers receive separate CDs, the buyer and his/her agent will still see all costs and fees paid by the seller on the buyer’s CD.
When separate buyer and seller CDs are issued, TRID dictates different content for the two disclosures.
- For the buyer’s CD, the lender may omit the Summary of the Seller’s Transaction on page three of the CD. TRID requires any closing costs paid by the seller (including real estate commissions) to be disclosed on page two of the buyer’s CD in all circumstances.
- For the seller’s CD, the lender may remove all information regarding the buyer’s terms of the transaction, including: any closing costs paid by the consumer; summaries of cash needed to close; contact information of the buyer’s lender; and, all loan-related information.
For more information, read NAR’s TRID CD Closing Disclosures Guide.