A Wisconsin State Journal article writes that the Wisconsin Insurance Commissioner Ted Nickel has warned homebuyers in a bulletin that they need to be careful about “blanket exceptions” in title insurance policies.
He wrote that title insurance companies
“have begun to use broad ‘blanket exceptions’ in their title insurance policy form for owners and (consumers), which exclude from coverage the most common encumbrances … that could generally be discovered during a public records search.”
The majority of title insurance policies exclude coverage of the type of information that cannot be found in public records, but there have been some that exempt even public record search results, Nickel said, leaving “little to no coverage for the consumer and does not warn the consumer that the title they are purchasing may have defects.”
The commissioner’s office said title insurance policies typically exclude coverage of “encumbrances” that can’t be discovered via a public records search. But state law says that a policy can be rejected that is “misleading because its benefits are too restricted to achieve the purposes for which the policy is sold.”
Well, it’s not over yet! We are still plagued by our faulty history with bad loans from unclean lenders.
The Consumer Financial Protection Bureau, HUD, Dept of Justice and 49 state attorneys general filed a proposed federal court order against Richmond, Virginia-based SunTrust Mortgage, Inc.
According to a CFPB press release, the order alleges that SunTrust “took advantage of homeowners with servicing shortcuts and unauthorized fees … deceived homeowners about foreclosure alternatives and improperly denied loan modifications,” and “engaged in illegal foreclosure practices.” If signed by the presiding judge, the order would provide at least $500 million in relief to borrowers who are underwater with their loans, among $50 million in other penalties. Full article at the cfpb site
I know this is a bit off the topic for my standard Public Records comments. Obviously abstractors make their living investigating public records.
But how far do we go with “telling it all?” An attorney in Utah wants to broadcast his divorce, as in D~I~V~O~R~C~E on YouTube. My first thought is that he doesn’t like his wife and wants to embarrass her. My second thought is perhaps he is a divorce court lawyer, looking for business. His comments are that he is trying to help the public understand the divorce process. I personally thing that’s going too far.
Although for those who like to peep into the lives of others, I’m sure there would be takers. What do you think? Next thing we know there will be a requirement to search YouTube for Divorce proceedings.
The FHFA report provides a detailed review of the safety and soundness of Fannie Mae, Freddie Mac, the 12 Federal Home Loan Banks and the Office of Finance.
No surprise that the Report stresses that Fannie Mae and Freddie Mac have almost eliminated the practice of purchasing higher-risk mortgages, such as no-income documentation or interest-only mortgages. But the Report also notes that continued losses from Fannie Mae’s and Freddie Mac’s high levels of problem assets (already on the books) and a reduction of settlement income from litigation are likely to drive down future earnings. FHFA says it will be necessary to expand private-sector investment if Fannie and Freddie are going to continue their dominance in the mortgage market.
The Consumer Financial Protection Bureau has fined the largest real estate firm in Alabama, RealtySouth, $500,000 for improper disclosures that illegally benefited an affiliated company. According to the CFPB release,
“RealtySouth’s preprinted form purchase contracts, which its agents provided to homebuyers preparing to make an offer on a home, either explicitly directed or suggested that title and closing services be conducted by its affiliate, TitleSouth.” CFPB Director Richard Cordray stated, “The Consumer Bureau will continue to take action against companies that attempt to modify disclosures and keep consumers in the dark.”
The Consumer Financial Protection Bureau issued its semi-annual report, a 177 page update on its progress. As pertains to the Land Title, Closing, Title Insurance and Mortgage group, it stated that it issued a final rule to consolidate federal mortgage disclosures under TILA and Sections 4 and 5 of RESPA. These new
“Know Before You Owe” mortgage forms will “replace the existing federal disclosures and help consumers understand their options, choose the deal that is best for them, and avoid costly surprises at the closing table.”
The CFPB stated that consumers of all experience levels were able to understand the new forms better than the current forms. The rule will become effective August 1, 2015. The Bureau also issued several rules in January 2013 implementing changes made by the Dodd-Frank Act to the laws governing aspects of the mortgage market.
The FULL CFPB REPORT can be found here.
As a board member on not one, but two Homeowner’s Associations and several committees, I had to laugh when I read this great article by Nancy Polomis at Hellmuth and Johnson Law Firm in Edina, MN. It’s Hard not to recognize the cast of characters in her play. We all know the “Complainer”, the “Bully” and the “Hawk” in our daily activities and she gives some great advise as to how to handle them.
Read her advise along with some good reminders about MCOIA law in this article. Thank you Nancy!
I am pleased to announce that I have just passed the Certified Distance Education Instructor (CDEI) certification! As many of you know, I have been teaching title the traditional classroom way with a passion for many years – title examination, closing, legal descriptions, changes in real estate law, title abstracting and searching. I am a title geek who is now moving to Online Title Education both for Professional Education and for Pre-license Closer Education.
Going into new online training will be a challenge for me that I take seriously and look forward to.
I will work hard with you to make online real estate title education
I hope many new and former students will become members of my online real estate “family.” I often get emails from you, and will try to incorporate those into the online classroom along with your questions. Thanks for your support!
Old Republic National Title’s EVP and CIO officer, Rob Chapman is the current President of ALTA
American Land Title Association (ALTA) President Rob Chapman delivered the following oral testimony today during a hearing before the Financial Institutions and Consumer Credit subcommittee of the House Committee on Financial Services titled “Legislative Proposals to Improve Transparency and Accountability at the Consumer Financial Protection Bureau (CFPB).”
During the hearing, Chapman identified three ways that Congress should work in a bipartisan way to improve outcomes for consumers and businesses:
“First, Congress should pass H.R. 4383,” said Chapman, president of ALTA, the national trade association of the land title insurance industry. “This bipartisan legislation by Rep. Pittenger and Rep. Heck would establish a small business advisory board at CFPB, similar to those already established for community banks and credit unions. Second, direct the CFPB to issue advisory opinions. An advisory opinion provides certainty to those of us who comply with federal consumer financial law in real life situations.
“Finally, inject sunlight on policy statements, bulletins and other guidance documents by encouraging public feedback. Public comments ensure these documents are useful and understandable to industry, provide a safety valve to reduce unintended consequences, and produce better policy outcomes for consumers and industry.”
A full copy of Chapman’s oral testimony is available here.
The American Land Title Association, founded in 1907, is a national trade association representing more than 5,000 title insurance companies, title agents, independent abstracters, title searchers, and real estate attorneys. ALTA members conduct title searches, examinations, closings, and issue title insurance that protects real property owners and mortgage lenders against losses from defects in titles.