CFPB Releases Fact Sheet for Construction Loans Under TRID

January 14, 2016

The Consumer Financial Protection Bureau (CFPB) released a fact sheet to clear up confusion on whether the TILA-RESPA Integrated Disclosures (TRID or Know Before You Owe) should be used on construction loans. According to the fact sheet, most construction loans that are closed-end consumer credit transactions secured by real property are covered by the Know Before You Owe mortgage disclosures.

A construction loan that is an open-end transaction or a loan for a commercial purpose is not covered. Additionally, the CFPB provides guidance on disclosing construction loans with permanent financing as one loan or two loans.

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