9 posts categorized "Advocacy"

02/19/2014

A Great Story About Title Insurance in Honor of Presidents' Day

I hope everyone had a great Presidents’ Day, or as it is legally known, Washington’s Birthday. We have come to regard the holiday as a celebration of all of our presidents and before we get into the goings-on at ALTA, please indulge me in this industry-relevant story about our 13th president, Millard Fillmore.

President Fillmore was born January 7, 1800, in Cayuga Country, New York. Just a year before his birth, the future president’s father, Nathaniel, and uncle, Calvin, purchased a farm in Locke Township sight unseen. The land was part of the central New York military tract set aside for sale to soldiers who had fought in the Revolutionary War. Faulty surveys, fraud and ignorance left title to land in the military tract uncertain, prompting the state of New York to send a team of commissioners to review and settle all land titles in the area. Unfortunately for the Fillmore brothers, they were unable to defend their title against the commissioners’ findings.

Following the complete failure of their title, the Fillmores took up a perpetual lease for a farm in Sempronius, NY. However, the poor soil, forest cover and rugged terrain of the plot led to rough times for the Fillmores. This experience led Nathaniel Fillmore to push his children into professions other than farming. For his son Millard (a good student and avid reader), Nathaniel secured a clerkship studying law with Judge Walter Wood. Wood was the richest person in the country, having earned his money and reputation on title litigation. It was this experience that led the future president to become an attorney.

We can assume that his experience clerking for Judge Wood led to one of President Fillmore’s most astute and important acts, promoting a law to perfect title in the new state of California. In 1850, Fillmore became president on the passing of President Zachary Taylor. In his first State of the Union, Fillmore addressed one of the most pressing issues of the day, the status of land ownership in the newly acquired states of California, Texas and New Mexico. In that message to Congress, Fillmore stated:

The uncertainty which exists in regard to the validity of land titles in California is a subject which demands your early consideration. Large bodies of land in that State are claimed under grants said to have been made by authority of the Spanish and Mexican governments. Many of these have not been perfected, others have been revoked, and some are believed to be fraudulent. But until they shall have been judicially investigated they will continue to retard the settlement and improvement of the country. I therefore respectfully recommend that provision be made by law for the appointment of commissioners to examine all such claims with a view to their final adjustment.

This is a great statement about what the land title industry does every day and how that work is important to our country and the free flow of capital. Can you imagine if there was an entire paragraph in a modern day State of the Union about the importance of clear title? Join me in celebrating the achievements of an oft overlooked President Millard Fillmore.

01/09/2014

What’s on Tap in 2014 for Congress

As we begin the second session of the 113th Congress, many pundits in Washington are hoping that 2014 will be a more productive legislative year than 2013. Given the number of priorities on the to-do list and the limited amount of time to get them done (29 weeks because it is an election year), let’s hope last December’s budget deal is a good omen of things to come.

While the year will start with a discussion on extending unemployment benefits, probably the most pressing task for returning lawmakers will be to pass a Congressional spending plan (also called appropriations) for the 2014 fiscal year and avoiding another shutdown. The deadline is January 15th and should be made easier thanks to the recent budget agreement. The big issues will be cuts to defense spending and whether efforts will be made to defund the Affordable Care Act.

Closely following on the heels of the appropriations bill will be the need to raise the country’s debt ceiling. The temporary suspension of the debt limit will expire on February 7 and it is expected that Republicans will demand some concessions in exchange for raising the debt limit and avoiding default.

Reforming the tax code already faced long odds, but the effort suffered a serious blow when President Obama named Senate Finance Chairman Max Baucus (D-MT) as the new ambassador to China. Incoming chairman Ron Wyden (D-OR) may not share the zeal for the topic as his House counterpart, Ways and Means Chairman Dave Camp.

While tax reform might be dead, what is likely is that lawmakers may push to retroactively extend some or all of the 55 tax breaks that expired at the end of last year. Some of these tax breaks (also known as “extenders,” in DC speak) include deductions for mortgage debt cancellation, state and local sales taxes, research and development, hiring veterans, wind power development, mass transit benefits and racetrack construction.

Momentum on immigration reform has slowed since the Senate passed its bipartisan bill in June 2013. House Republicans have taken a piecemeal approach that should reach the House floor this year. The main difference is that the House bill will likely only provide a path to a legal resident status (“green card”) instead of citizenship for undocumented immigrants.

One topic that does seem to have momentum is patent reform. Last December the House passed legislation making it more difficult for so-called “patent trolls” to sue companies and extract large settlements. The Senate is expected to pass a more limited version of the bill, but odds are good that these differences can get worked out in a conference committee.

Another issue that ALTA is watching closely is flood insurance reform. Recently Mary Landrieu (D-LA) and Chuck Schumer (D-NY) told reporters they had assurances that Senate Majority Leader Harry Reid would file a cloture motion in “early January” to advance legislation, S. 1846, to delay scheduled rate changes for homeowners residing in flood zones in revised maps. In the House of Representatives, Bill Cassidy (R-LA) has introduced a related measure.

Other topics that should get some consideration in Congress include a new multi-year farm bill, trade and customs legislation, cybersecurity and reforming the NSA’s data collection program.

If you have any questions about the congressional agenda, please contact Ben Lincoln, ALTA’s director of government affairs, at benjamin@alta.org or 202- 261-0308.

To get involved with legislative issues impacting the industry, I encourage you and your staff to join the Title Action Network, which is a free, energrized grasssroots movement consisting of  title insurance professionals promoting the industry's avlue and protecting consumer rights.

11/21/2013

Copy of presentation from webinar titled "A New Era in Closings"

We had more than 1,400 people register for today’s webinar "A New Era in Closings," which addressed the Consumer Financial Protection Bureau's final rule for integrated mortgage disclosures. Our provider, however, has a limit of 1,000 attendees. If you could not access the webinar, please know that is was recorded. After it’s edited, you will be able to watch the prese
ntation on our YouTube channel at www.youtube.com/altavideos or on our blog.

The webinar focused on top-level analysis of the final rule, which is 1,888 pages long. This was only the first of many educational opportunities we will provide about the integrated mortgage disclosures.

Integrated_disclosures_112113 1

11/20/2013

CFPB Provides Seven-page Summary of Mortgage Disclosure Rule

201311_cfpb_tila-respa_detailed-summary_Page_1If you don't have time to read all 1,888 pages of the Consumer Financial Protection Bureau's final rule for integrated mortgage disclosures, the Bureau has provided this great summary document, which addresses the scope of the rule, highlights the new Loan Estimate and Closing Disclosure, limits on closing cost increases and proposals not adopted in the final rule.

The CFPB listened to ALTA concerns and gave the industry plenty of time to implement the new forms as the final rule becomes effective Aug. 1, 2015.

You can download a PDF of the summary here.

Submit Your Questions/Comments About the Rule to ALTA

Please send your questions or comments about the Consumer Financial Protection Bureau's final rule for integrated mortgage disclosures to respacomments@alta.org. We will post answers and analysis to the final rule and forms here on our blog. We encourage title professionals to follow the blog as we will continue to provide analysis and information about implementing the new mortgage disclosures. The CFPB set an effective date of Aug. 1, 2015 for the industry to begin using the new disclosures.

Here are links to the final rule, Loan Estimate and Closing Disclosure:

The CFPB also has provided some additional information, including a factsheet about the integrated mortgage disclosures and information about the testing process used to arrive at the final rule.

09/20/2013

Title Action Network Adds New State Partners, Launches New Membership Contest

The Title Action Network (TAN) welcomed the state land title associations of Washington, Arizona, Michigan, and Pennsylvania as official partners last week.

The new states bring TAN’s total number of state land title association partners to 29. If your state would like information on becoming an official state land title association partner, please e-mail Madeleine Nagy at mnagy@alta.org or call 202-261-2949.

TAN’s membership is now at 4,500! To capture some of the TAN excitement heading into ALTA’s Annual Convention, the Title Action Network has launched a new contest today. Any individual that recruits a new TAN member between today and September 30 will be entered to win a FREE Apple iPad! Click here for more information.

It’s simple—just ask anyone you know in the land title industry to join the Title Action Network at www.titleactionnetwork.com and make sure they list your name in the “referred by” line. 

If you have any questions about starting a TAN membership drive in your state or company, please e-mail Wayne Stanley at wstanley@alta.org or call 202-261-2932.

If you'r wondering how TAN can help, check out this video:

Congress Urges Cordray to Drop ‘Optional’ From Owners’ Title Insurance on Forthcoming Mortgage Disclosures

“I would just suggest get rid of the word optional.”

That was the message from Congressman Ed Perlmutter (D-CO, and this year’s recipient of the Protecting the American Dream Award) to Consumer Financial Protection Bureau Director Richard Cordray at a hearing on Thursday on the Bureau’s semiannual report to Congress.

Congressman Perlmutter’s statement came after Congressman Gary Miller (R-CA) and Director Cordray had an exchange on the topic of calling owners’ title insurance “optional” in the final rule. Here is the exchange:

REP. MILLER: I enjoyed your opening statement. You talked about empowering consumers, fair and transparent competitive marketplaces, dealing with bad actors, which we saw plenty of those before 2007 and you supervise a program to create larger credit reporting companies. The one thing that’s kind of glaring to me is you took title insurance and you tagged it as optional for the buyer. And that’s a real concern for me? Now, anytime a buyer would look at something and they’d say optional and it cost money, generally they don’t do it because most people really don’t understand what optional means or they don’t know what title insurance really means. But your bank regulators and GSEs all require a title insurance before they’ll make a loan?And if we’re concerned about empowering consumers, we really should be concerned about their safety. And why would you take something that I believe is very, very important that could arise in the future and put optional on it?

MR. CORDRAY:  First of all, I take your point. Your point is, you know, obviously meritorious that, you know, title is often in question with properties, and different parts of the country more so than others. Title insurance obviously is meant to address the risks of that. I will be happy to go back and take a look at the point you’re raising about how we’re characterizing it on that proposed form.

In addition to the owners’ title insurance questions, Congressman Randy Hultgren (R-WI) pushed Director Cordray on the implementation timeline for the rule and the topic of machine-readable forms. Hultgren asked:

REP. HULTGREN: I know you’re working on one more major mortgage rule- making, the merging of RESPA and TILA mortgage disclosures into one document. And the proposed rule was over 1,000 pages and will affect everyone involved in a home purchase: home-buyers, lenders, realtors. As I understand it, given how much technical work must go into getting everyone’s system updated and ready, I’d like to think it would be impossible to have this rule implemented before January 15th. Is that true? Why or why not?

CORDRAY: So the (inaudible) rule was one of the—it was a special mortgage rule in the sense that Congress required us to do it, but didn’t give us a deadline, which told us that Congress wanted it done, but not quite on the same priority maybe as some of the other rules. We will now finalize that rule later this year. We will give an implementation period for that that I think will be sufficient for industry. And we’re talking and—and listening closely to what they have to say about that. We recognize that’s going to require a fair amount of systems and process changes. And that will lag behind the changes that they’re making for January...

REP. HULTGREN: So there will be a delay in implementation requirements...

CORDRAY: It’s not even finalized yet, that one, unlike all the others. And when it is finalized, there will be a period of time to recognize they need to finish implementing this rule and then have ample time to bring that into effect.

REP. HULTGREN: Getting very specific on this, I know one of the requirements of the Bureau’s RESPA-TILA proposal is to require all disclosure forms to be machine-readable record format. I wonder if you could tell me what that means, what the purpose of machine-readable forms are. While I understand and appreciate that this will help the Bureau in examination, convergence to these systems, as you can imagine, will be incredibly costly for small lenders, ESCO agents and title companies. I wonder what efforts you’re doing—taking to help minimize the cost burdens on this rule on small businesses.

CORDRAY: Yeah, thank you for the question. Just as you’re hearing about that, we’re also hearing about it. We’re trying to think about exactly what purpose that serves and—and to what extent those benefits are worth the burdens. Obviously, the point I—I know is to create some uniformity so that there can be more comparison, more analysis and more understanding of the market. Whether—whether that’s all appropriate or needs to be done now is something that we’re looking at.

REP. HULTGREN: My time is just about done. Just, you know, I hope you’ll look at cost benefit analysis. That doesn’t happen enough in this. And it absolutely is having an impact on small businesses.

You can view an archived webcast of the hearing here.

We are grateful to Congressmen Hulgren, Miller and Perlmutter for posing these important questions to Director Cordray. As we move closer to the release of the final rule, we will eagerly watch for how the Bureau resolves these and other issues brought up in ALTA’s comment letter. We're still hearing sometime in October and will provide a webinar shortly after the release to go over what the CFPB unveils.

If you have any questions about the hearing please contact please contact ALTA’s vice president for government and regulatory affairs, Justin Ailes, at justin@alta.org or 202-261-2937.

You can also view ALTA's advocacy efforts regarding the integrated mortgage disclosures here.

08/28/2013

Changes to QRM Proposal a Victory for Consumers and Industry

The Qualified Residential Mortgage (QRM) rule will create additional underwriting standards—most notably a downpayment requirement—in order to avoid risk-retention requirements for mortgage securitizations. In a letter to six regulators, ALTA joined members of the Coalition for Sensible Housing Policy urging for a broad definition of the QRM and to keep it consistent with the Qualified Mortgage (QM) mortgage rule, was was develoed by the Consumer Financial Protection Bureau and goes into effect in January.

ALTA urges regulators to oppose a stringent 20 percent down payment requirement, saying this would limit the ability of lower-income households and first-time buyers to enter the market.

In a victory for the industry, the FDIC along with five other agencies on August 28 re-proposed the QRM rule and now aligns better with the QM Rule, which puts limits on debt-to-income ratios, prohibits low- and no-documentation lending, negative amoritizations, balloons and interest-only loans. CoreLogic had predicted the QM rule coupled with the QRM rule with a 10 percent downpayment requirement would result in only 25 percent of purchase originations meeting eligibility requirements.

 QM_QRM_impact
ALTA was pleased to learn that regulators listened to industry and consumer coalitions to modify the QRM rule and eliminate the proposed 20-percent down payment requirement. Understanding that sensible credit standards can exist without a significant down payment requirement will help ensure the possibility of homeownership for credit-worthy borrowers for generations in this country.

As the independent third party at the real estate closing table, we understand the importance of having access to safe and affordable loans. For more than a century, title insurance has provided this backstop, helping ensure residential mortgages are of very high credit quality while reducing risk for all parties involved in real estate transactions.

ALTA will continue to promote a commonsense underwriting requirement to the QRM rule, which, through a title search backed by a title insurance policy, is as an essential aspect of safe and secure mortgage lending that ultimately allows lenders to lend, spurs investors to invest and leads to consumers getting the keys to their home.

ALTA Releases New Tools for Implementation of Best Practices

When planning for the future, it can be helpful to start by looking at the past. It’s hard to fathom that just one year ago (August 20th to be exact) the ALTA Board Governors met in Chicago to start the process of drafting ALTA’s “Title Insurance and Settlement Company Best Practices.” Since then, ALTA has not only finalized the Best Practices but also made improvements with Version 2.0. The Board also went on the road to talk with agents and underwriters about why we developed the Best Practices, the Best Practices Task Force met with both national and warehouse lenders to explore how the Best Practices can meet their needs and help them know the partners with whom they do business. Most recently, we created a set of assessment procedures and a model certification.
While we have done a lot in the past year on the Best Practices, we recognize that there is much for ALTA to do to help our members adopt the Best Practices. That is why we are pleased to kick off the second year of the Best Practices with ALTA’s “Best Practices Assessment Preparation Workbook.”
The Best Practices Workbook provides ALTA members with a tool to help gauge their company’s readiness with ALTA’s “Title Insurance and Settlement Company Best Practices.” This invaluable tool lets companies identify issues that should be addressed to meet the requirements of the Best Practices and provides an easy framework for collecting all the documentation necessary to prepare for a Best Practices Assessment. Best of all, we are pleased to offer this tool free to all ALTA members.
Over 400 people attended our Best Practices webinar last Thursday (Aug. 22) in which we launched the Best Practices Workbook. Right now, only Chapter 1 (Licensing) is available. Over the next month we will release the other six chapters, which correspond to each of the Best Practice pillars. The Best Practices Workbook can be found at www.alta.org/bestpractices/workbooks.cfm. If you missed the webinar, here's a recording:
 
The Best Practices Workbook is available as a Microsoft Excel document. It is a series of questions about your company’s current business practices.  Each question should be answered with either a yes or no. Some questions may require a narrative response. In addition, the Best Practices Workbook asks you to indicate whether the practice is documented in your written procedures and whether your company has a system for determining whether you and your employees are following those procedures.  Included with the Best Practices Workbook is an instructional video and welcome letter to help you to get the most value out of the Workbook. Here's the tutorial video:
http://www.youtube.com/watch?v=-2tlpAF-c94
One aspect of this workbook I highly recommend is the automatic “Action Items” report of controls and procedures that identifies issues your company should work on or put in writing to meet the Best Practices. This Action Items report can only be produced if you complete the workbook electronically. We think ALTA’s “Best Practices Assessment Preparation Workbook” is a great tool and we hope that members find it to be helpful not only as you prepare for a Best Practices Assessment but also in the day-to-day running of your company.
For more information on ALTA's "Title Insurance and Settlement Company Best Practices," go to www.alta.org/bestpractices.