Know Your Traditional and E-closing Options

Closing optionsThere’s been a lot of buzz about online notaries and digital closings over the past year. While many states will start to consider online notary legislation, the fact remains there are four main ways closings can occur. Here’s a summary of the options:

Traditional Wet Signing: These closings are handled in-person and all of the documents are in paper format. The closing is handled with an in-office or mobile notary public signing with the buyers and sellers. They can also be conducted by what is called a mail-away, where the documents are mailed to the buyers and sellers, who must locate a public notary in their area and sign in their presence.

Hybrid E-closing: These closings are similar to the traditional closing in that they are handled in-person. Some of the documents are wet signed, while some are signed digitally with an e-signature. These are typically handed in-office or the mobile notary drives to meet the buyers and sellers.

In-person Digital E-closing: Terms for this type of closing have not been standardized yet in the industry. In this closing, the notary public is sitting face-to-face with the buyers and sellers, but 100 percent of the documents are signed with e-signatures. This can happen in the title agent’s office or the notary public can meet the buyers and sellers at a different location.

Online Notary E-closing: This type of closing is the newest version. It has many different names, but often referred to as online notary. You might also hear the terms webcam or remote used to describe this type of closing. What’s new here is that the notary public is not face-to-face with the signers. Instead the notary public appears before the buyers and sellers via some webcam or audio visual-technology. Because of that, all of the documents are digital and e-signed. Currently, only two states have legislation on the books that governs online notaries. Virginia and Montana allow for this type of closing in certain circumstances. Texas and Nevada passed online notary bills that go into effect in 2018. Several other states will consider online notary legislation in 2018 as well. 


ClosingCorp Reports Average Mortgage Closing Cost Data

The average national closing costs totaled $4,876, according to a recent survey released by ClosingCorp.

This data represents the average closing costs, including lender’s title, owner’s title, settlement, appraisal, transfer taxes (where applicable), recording fees and other costs including inspection (pest, roof and home) services and land surveys. This data is compiled using real rates and fees as reported by more than 20,000 real estate service providers in the ClosingCorp Network.

It shows the states with the highest average closing costs were:

  • District of Columbia ($12,573)
  • New York ($9,341)
  • Delaware ($8,663)
  • Maryland ($7,211)
  • Vermont ($6,839)

The states with the lowest closing costs were:

  • North Carolina ($3,206)
  • Iowa ($3,138)
  • South Dakota ($2,996)
  • Indiana ($2,934)
  • Missouri ($2,905).

“Closing costs can vary significantly, depending on the state or county a homebuyer lives in. For example, five counties in New York—Kings, Queens, Bronx, Richmond and Suffolk—had the highest closing costs, going well above the national and state average, due to having some of the highest transfer taxes in the country,” said Bob Jennings, chief executive officer of ClosingCorp. “Of course, many homebuyers are still surprised closing costs are even required—making it vital for our company to keep educating borrowers and helping lenders improve the accuracy of their loan estimates in order to eliminate any surprises.”

According to ClosingCorp, median fees are derived by running preconfigured loan scenarios against the verified rates and fees data it maintains for service providers and tax authorities with coverage in every county nationwide. The preconfigured loan scenarios are based on different loan types, loan purposes and loan amounts in $25,000 increments up to $100,000 then $100,000 increments up to $20,000,000. The results of running the preconfigured loan scenarios and application of the endorsement rules generates the median fees for every county. The results at the county level are rolled up to the CBSA level using number of housing units per county to create a weighted average. Assuming an 80 percent  loan-to-value ratio, ClosingCorp uses the median sales price for a given period for each CBSA and applies the fee calculation formulas to derive the median fees by CBSA.

Average Closing Costs by State


Average Purchase Price

Average Total Closing Costs






























































































































































CBSAs with the Highest Average Closing Costs


Average Purchase Price

Average Total Closing Costs

New York-Newark-Jersey City, NY-NJ-PA



San Francisco-Oakland-Hayward, CA



Dover, DE



Washington-Arlington-Alexandria, DC-VA-MD-WV



Reading, PA




CBSAs with the Lowest Average Closing Costs 


Average Purchase Price

Average Total Closing Costs

Muncie, IN



Marion, IN



Kokomo, IN



Indianapolis-Carmel-Anderson, IN



Jefferson City, MO



Counties with the Highest Average Closing Costs 


Average Purchase Price

Average Total Closing Costs

District of Columbia, DC



Kings, NY



Queens, NY



Bronx, NY



Richmond, MY



Pitkin, CO



Sussex, DE



Westchester, NY



Suffolk, NY



Montgomery, MD




ALTA Welcomes 2017-18 Board of Governors and Exec Committees

Board graphic


ALTA Redesigns 99-year-old Magazine, TitleNews

TN timeline

For nearly a century, TitleNews has been the go-to source of information about the land title insurance industry. Iterations have evolved from an extremely text-heavy publication since the first edition in 1918 to a magazine that attempts to meet the needs of today’s readers.

In the latest incarnation of one of the main ALTA member benefits, we’ve introduced a new layout structure that brings content to life and emphasizes navigation matching online reading habits. While new colors and fonts provide different look and feel, the content remains dedicated to providing members relevant and accurate information to help our member companies excel in a dynamic business and regulatory environment.

“For 99 years, TitleNews has been the go-to source of news and information for the land title insurance industry and we’re dedicated to providing this quality service for another century,” said Michelle Korsmo, ALTA’s chief information officer. “The redesign highlights content in a more contemporary and engaging fashion, provides more dynamic features, and uses fresh colors and creative typography that bring articles and content to life."

Deb Grace, vice president of business development for NextDeal, says she loves the refresh because it’s easy to read and user-friendly.

“I especially love the pullouts, which provide a quick point of reference- great idea,” she added.

Members of ALTA’s PR Committee helped guide and provide feedback for the redesign, which started nearly a year ago following a survey of TitleNews readers to learn about their likes and dislikes of the magazine.

“As a member of the PR Committee, I had the opportunity to give input on the redesign, which is something I believe we should be doing every few years to ensure that our trade publication is fresh and intriguing,” said Jenny Martin, senior vice president and corporation business development director for Futura Title & Escrow Corp. “We often talk about attracting the next generation to the title industry and this project demonstrated that ALTA recognizes the value of staying current by providing relevant industry updates and presenting them in an inviting modern format.”

Wayne M. Stanley, owner and chief inspiration officer for Bowe Digital, said he turns to TitleNews for the latest industry trends affecting the industry, information on the movers and shakers within the industry and to see what other companies are joining ALTA each month.

“TitleNews’ redesign is a welcomed and needed facelift for this industry staple,” Stanley said. “With the redesign, graphics will be front of center in the magazine giving you more time to focus on your work and less time pouring through long articles. In the digital era, there's still a place for print magazines, and TitleNews is leading the way for our industry."



ATG’s Birnbaum Takes the Ring to Support Mercy Home Boys & Girls

Peter J. Birnbaum, president and CEO of Attorneys’ Title Guaranty Fund Inc. will jump in the boxing ring to help support Mercy Home for Boys & Girls, an organization that provides homes, education and support systems to Chicago’s most vulnerable and disadvantaged youth.

Along with other contenders from the financial services and legal professions, Birnbaum will participate in a boxing match at Mercy Home’s fundraiser, “Ringside for Mercy’s Sake,” on Oct. 14. He is matched up against Quarles and Brady Managing Partner Paul Langer.”

LI-MercyHomeBenefit2017While ATG is a longtime supporter of Mercy Home for Boys & Girls, this is the first time one of its executives has duked it out at the annual fundraiser. One expects to see attorneys of Birnbaum’s caliber in the boardroom or in the courtroom, but in the boxing ring?

"ATG stalwart Ernie Codilis introduced us to Mercy Home several years ago,” said Birnbaum, who joined ATG in 1981 and was named president and CEO in 1991. “Mercy Home is a citadel protecting and keeping safe some of the most vulnerable children in Chicago. Supporting Mercy Home helps me pursue my personal mission to protect children and is in keeping with ATG's mission to support our community by helping those most in need. Having turned 60 this year I wanted to do something outside my comfort zone. By squaring off against Paul Langer, a cagey veteran boxer, a true gentleman and an outstanding trial lawyer we will (hopefully) give the crowd a good fight and raise significant money for a charity we both love.”

 Since its founding 130 years ago, Mercy Home has broken the cycle of neglect and abuse for over 30,000 kids through residential programs, aftercare, referral and monitoring services. Nearly 98 percent of Mercy Home’s $32 million annual budget is privately funded through the support of corporations, foundations and individuals. The organization receives no contributions from state or federal governments.

“I am pleased for this opportunity to support this very worthy Chicago organization that provides hope, healing and a fresh start for over 750 at-risk youth each year,” Birnbaum added. “The need now is greater than ever.”


CoreLogic Reports Jump in Mortgage Fraud Risk

The risk of fraud in mortgage applications increased 16.9 percent in the second quarter compared to the second quarter of 2016, according to CoreLogic’s latest Mortgage Fraud Report.

The analysis found that during the second quarter of 2017, an estimated 13,404 mortgage applications, or 0.82 percent of all mortgage applications, contained indications of fraud, as compared with the reported 12,718, or 0.70 percent in the second quarter of 2016. The CoreLogic Mortgage Fraud Report analyzes the collective level of loan application fraud risk the mortgage industry is experiencing each quarter.

Fraud risk

The report says that the continued shift to a purchase market is a key factor in the rise in application fraud risk due to stronger motivations and increased opportunities to commit mortgage origination fraud. A second factor leading to the fraud risk was a 48 percent increase in the share of loans originated through wholesale channels, the report found. According to CoreLogic, wholesale applications have shown a higher risk level than retail channels.

“This past year we saw a relatively large increase in the CoreLogic National Mortgage Application Fraud Index,” said Bridget Berg, principal, Fraud Solutions for CoreLogic. “If the factors that influenced the increase continue, including a shift to purchase transactions and growing wholesale channel origination activity, it is likely that mortgage application fraud risk will continue to rise as well. Fraud on cash-out refinance transactions and home equity loans may become more of a factor in the coming years as home values and equity rise.”

According to the report, New York has the highest level of application fraud risk. Florida, which held the top spot for the last several years, dropped to number 3, thanks to a 3 percent decrease in application fraud risk from 2016.

States with the greatest year-over-year growth in risk include:

  • Iowa
  • Indiana
  • Missouri
  • Louisiana
  • Idaho.

According to the report, although they have the highest growth in risk, except for Louisiana, the other four states are still outside the top 25 in terms of overall risk.

CoreLogic found that Jumbo refinance loans are the segment showing the greatest fraud risk increase by loan type.

Occupancy Fraud Risk

  • Up 7 percent
  • This fraud occurs when mortgage applicant deliberately misrepresent their intended use of a property (primary, secondary or investment)
  • States with largest YOY increase: Hawaii, Colorado, Nevada, Montana and Nebraska

Transaction Fraud Risk

  • Up 3.9 percent
  • This fraud occurs when the nature of the transaction is misrepresented, such as undisclosed agreements between parties and falsified down payments. This risk includes third-party risk, non-arm’s length transactions and straw buyers
  • States with the largest YOY increase: South Dakota, Wyoming, Montana, New Hampshire and North Dakota

Income Fraud Risk

  • Up 3.5 percent
  • This fraud includes misrepresentation of the existence, continuance, source or amount of income used to qualify.
  • States with largest YOY increase: Alaska, Indiana, Maine, Alabama and Utah

Property Fraud Risk

  • Down 1.9 percent
  • This fraud occurs when information about the property or its value is intentionally misrepresented.
  • States with largest YOY increase: Wyoming, Washington, D.C., Vermont, New Mexico and Indiana

Undisclosed Real Estate Debt Risk

  • Down 2.7 percent
  • This fraud occurs when a loan applicant intentionally fails to disclose additional real estate debt such as mortgages and real estate taxes.
  • States with largest YOY increase: North Dakota, Nebraska, Iowa, Wyoming and Indiana

Identity Fraud Risk

  • Down 7.3 percent
  • This fraud occurs when an applicant alters, creates or uses a stolen identity to obtain a mortgage.
  • States with largest YOY increase: Maine, Alaska, Michigan, Montana and South Dakota

Multi-Closing Fraud Risk

According to the report, multi-lien fraud is a profitable scam that takes advantage of the lag between closing and recording to solicit multiple loans on a property. A spike in this fraud risk was reported in 2014. This activity decreased in 2015 and 2016, but CoreLogic projects this to increase in 2017.

The Importance of Educating Clients About the Threat of Wire Fraud

By Preston Guyton

Wire fraud is a serious concern, and it can happen during a real estate transaction. One of the best things real estate professionals can do for their clients is educate them on how this happens, how common it really is and how clients can protect themselves from the dangers. By doing that, many clients will be safer and the chances of them becoming victims of wire fraud during their transaction will be greatly reduced. Additionally, this builds more trust between clients and real estate professionals, as they work together to complete valuable and important transactions.

How Common is Wire Fraud in Real Estate Transactions?

Wire fraud in real estate transactions is more common than most people think. At the Idea Exchange Council for Brokers, NAR General Counsel Katie Johnson asked a large group of real estate professionals whether they had any clients who had been victims of wire fraud. She also asked whether they knew of other agents who had clients who had been victims. Over one-third of the agents raised their hands indicating that they either had clients who were victims or knew other agents who had clients who were victims.

While the NAR Council was not an extremely large sample size, this indicates that many real estate professionals have had clients who have been affected by wire fraud scams. These scams take millions of dollars from unsuspecting consumers each and every year, and the problem is only becoming larger. Fortunately, a good understanding of how this takes place and strong communication with clients about how to avoid it can reduce the risk. In time, this may become far less of an issue for clients and real estate professionals than it is today. That could save millions of dollars and protect real estate clients, allowing them to safely buy their homes without fear of wire fraud and related scams.

How Does Real Estate Transaction Wire Fraud Happen?

Wire fraud happens in real estate transactions in a way that is deceptively simple. Hackers who are looking to commit this type of fraud break into email accounts. Then they look through messages in those accounts for anything related to a current, ongoing or upcoming real estate transaction. When they find something, they send a message that looks like it comes from the real estate agent, closing company or mortgage company. They provide “new” wire instructions for where the money is supposed to go.

Once the money is sent, there is nothing that can be done about the fraudulent information, because the hackers are very hard to track. (For more on this, you can check out the TitleNews article "Phishing for Wire Transfers") Not only does this cost buyers a lot of money every year, but it also keeps them from closing on the homes that they had intended to buy. That's a very unfortunate situation for everyone involved.

What Are the Best Ways to Protect Real Estate Clients From Wire Fraud During Transactions?

To help keep clients safe, industry professionals can:

  • Create a standard warning about these scams and build it into the signature line of their email to help raise awareness
  • Be clear about communication practices for every transaction
  • Call clients immediately before any legitimate wire transfer, so they know it's going to the right place and people
  • Avoid free wi-fi when doing anything sensitive, so information can't be captured as easily
  • Use strong passwords, and make sure those passwords get changed frequently
  • Employ someone who handles and monitors security systems for the real estate firm to reduce the risk of being hacked

With the right education and information, real estate professionals and clients can work together to have good transactions that are free from wire fraud and other forms of hacking and theft. 

Preston Guyton is broker in charge and managing partner of CRG Companies. He can be reached at www.sellingmyrtlebeach.com/


Find Your ‘What If?’ at ALTA ONE

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TRID Allows for Partial Exemption for Housing Assistance Loans

Housing finance agencies (HFA) offer individuals, families and businesses a wide range of support in realizing their dreams. Loans provided by housing finance agencies or by private creditors who partner with housing finance agencies that extend credit within the guidelines of HFA programs are low-cost, non-interest bearing and subordinate- lien loans. These loans allow middle to low income families obtain a mortgage for which they would have otherwise have trouble qualifying.

As of Oct. 3, 2015, the TILA-RESPA Integrated Disclosure Rule (TRID) required that lenders issue disclosures to consumers in most residential mortgage transactions. In order to be less onerous on lower risk loans, the TRID rule allows for a partial exemption from the disclosure requirements. On July 7, the Consumer Financial Protection Bureau (CFPB) amended the qualification requirements for the partial exemption for housing financing loans and down payment assistance loans—an act which the bureau believes will make the program more flexible and encourage its use.

In order to qualify for the partial exemption, the loan must be amortizing, forgivable and include fees that cannot exceed 1 percent of the principal of the loan. Previously, the 1 percent threshold included recording fees and transfer taxes. The CFPB amended the rule to exclude recording fees and transfer taxes from the 1 percent threshold.

Proponents of the amendment persuasively argued that excluding recording fees and transfer fees from the 1 percent calculation will make the program more flexible, and thus, increase the amount of HFA loans disbursed. The bureau believes that statutory predetermine fees do not pose a risk sufficient enough to warrant its incorporation since it is not determined by the market. Since recording and transfer fees are predetermined fees set by state and local jurisdictions—and not the market, there is limited risk in excluding it from the 1 percent threshold calculation.

The bureau believes that excluding recording fees and transfer fees will increase the availability of low-cost, non-interest bearing, subordinate-lien loans to low- and moderate-income borrowers.

Click here for more information.


ALTA Registry: Be Part of the Solution


In 1878, New Haven, Conn., became home to what is considered the world’s first telephone directory, consisting of a single piece of cardboard that included listings for 50 individuals, businesses and other offices in the city of 150,000 people.

While other businesses had used telephones before—even printing lists of subscribers—the New Haven version claim to primacy rests on the fact that it was the first such list to include private customers as well as business lines.

This phone “book” did not list telephone numbers, only names. Early telephone directories existed solely for the purpose of alerting customers to the existence of other telephone subscribers. To make a call, the telephone user would pick up the phone and tell the operator the name of the person to ring up.

In the title and settlement space, there has never existed an online, searchable database that could be used to identify title and settlement agents and real estate attorneys early in the real estate transaction. Until now. ALTA Registry Infographic 1 - 2017 (1) copy

ALTA has created an online phone book—the ALTA Registry—a first-of-its-kind industry utility that allows lenders to know they are working with the correct company. Beginning Oct. 1, agents and underwriters will work together to communicate and confirm company name and contact information—providing lenders with a trusted utility to identify transaction partners.

“Mortgage lenders, title insurance agents, real estate attorneys, title insurance underwriters and other participants in the real estate closing process must be able to identify each other and communicate in a timely and consistent manner throughout the mortgage transaction,” said Michelle Korsmo, ALTA’s CEO.

Similar to finding someone’s number in a phone book, the national ALTA Registry is a snapshot of information. You may find a house you like on Zillow, but you would still call your real estate agent to see if it’s still available and if the price has dropped, according to Korsmo. The ALTA Registry database lists a business and its accurate information at the time of confirmation by a title insurance underwriter. 

The ALTA Registry offers a unique seven-digit identifier, the ALTA ID, which is automatically assigned to each new database record as a permanent ID number and is never changed, reassigned or reused. This is the number assigned to all records within the ALTA Registry. For organizations with a network of branches, each office location will have its own ALTA ID and may be connected to the HQ or head office location, called a “primary business location” with no requirement for consecutive or numerically correlated ALTA ID numbers. ALTA ID numbers are available for free to title agents and real estate attorneys. 

“ALTA estimates there are nearly 30,000 title and settlement companies, and real estate attorneys in the United States,” said Eddie Oddo, co-chair of the ALTA Registry Committee and vice president of corporate business solutions for First American Title Insurance Co. “Establishing and confirming a business on the ALTA Registry helps ensure more efficient communication among all parties in the real estate transaction.  Lenders, underwriters, agents and vendors can easily and confidently identify the right settlement provider across each of their databases—something our industry needs but has struggled with in the past.”

Independent escrow companies will not have their companies listed in the ALTA Registry. These entities do not have formalized relationships with title insurance underwriters, making it complicated to confirm their company name and location(s).

Lenders want this type of service from the industry in order to confirm the identity of the service providers that they, or their customers, have engaged to provide settlement services. Having a registry also helps lenders ensure their risk-management procedures are met and will provide further depth to their third party supplier oversight activities.

Jack Rattikin, the other co-chair of the ALTA Registry Committee and president of Rattikin Title Company, said that mortgage lenders need confirmation earlier in the real estate transaction that they are doing business with the correct title and settlement company or real estate attorney.

“The ALTA Registry is a tool for your company to show your mortgage lender you are a part of the solution to provide more clarification and transparency in the real estate transaction,” he said. “In addition, the registry helps mortgage lenders add an extra layer of confirmation that they are working with the appropriate title and settlement company or real estate attorney and properly protecting their consumers’ non-public personal information.”

What You Need to Do

  • Visit alta.org/registry to see the latest news and announcements, including launch date details.
  • Title and Settlement Agents: On-boarding begins in October. Title agents will be able to review their existing ALTA records and add any missing records. Once records are reviewed and updated, a company contact person may request an ALTA Registry listing via the ALTA Registry Management System (RMS) section of the ALTA website. Underwriters will review and confirm title agent requests before listings are published in the ALTA Registry. It’s important to note that only agents that have been confirmed by at least one underwriter will be listed in the ALTA Registry.
  • Real Estate Attorneys: On-boarding will begin in January 2018. Attorneys will be able to request a listing by submitting attorney licensing information as confirmation. Attorneys who are title agents should be confirmed by their underwriter(s) and listed as title agents.
  • Underwriters: On-boarding began in July 2017, and is ongoing. Underwriters who want to confirm agent listings participate in an on-boarding process so they will be ready to confirm agent listings.

What the ALTA Registry Is NOT

The ALTA Registry is NOT a verification system.

  • Google Earth can’t verify real-time accuracy in its maps, neither can the ALTA Registry. The registry confirms that as of the date provided a title or settlement company or real estate attorney maintained a business at the listed address.
  • The ALTA Registry is not the equivalent of a Closing Protection Letter (CPL); the ALTA Registry does not provide an authorization to proceed with a transaction.
  • The ALTA Registry does NOT confirm optimized risk management practices.
  • ALTA does not certify Best Practices compliance and neither does the ALTA Registry. Participation in the ALTA Registry shows that the title or settlement company, or real estate attorney wants to be part of the solution to provide more accurate data and a more efficient real estate transaction.
  • The ALTA Registry does not confirm that a business has optimized its risk management practices in accordance with individual title insurance underwriter or mortgage lender requirements.