Do title agencies fall under this scrutiny by Dodd-Franks?
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Monday, July 4, 2011
Consumer Financial Protection Bureau requests comment on which non-bank companies should be directly supervised under the Dodd-Frank Act
New Jersey Title Insurance Linkedin Group
Wednesday, June 29, 2011
U.S. Supreme Court to hear title insurance kickback case - Boston Real Estate - Boston.com
Richard D. Vetstein talks about how a title insurance case has made its way to the US Supreme Court.
In a case closely watched by the title insurance and real estate settlement services industry, the United States Supreme Court has agreed to hear a class action which will decide whether consumers can sue under the Real Estate Settlement Practices Act (RESPA) over a title insurance referral arrangement that allegedly violated RESPA’s anti-kickback provisions. The case’s outcome could shield title insurers, banks and other lenders from litigation under RESPA and a wide range of federal and state laws. If First American wins this case, we could see title insurance companies in Massachusetts taking a much more active role in the operations of their favorite and most profitable agents.The case is Edwards v. First American Title Co. For more coverage of the case, read the SCOTUS Blog summary here.
No kickbacksClass action attorneys file hundreds of cases each year on behalf of borrowers alleging violations of RESPA, which prohibits “any fee, kickback or thing of value,” in exchange for a business referral. RESPA also forbids that a “portion, split, or percentage of any charge made or received for the rendering of a real estate settlement service” be paid for services that are not actually rendered to the customer. If a violation of the statute is proven, a court can award a plaintiff treble damages, or triple the amount, for any charge paid.
In a lawsuit filed in 2007, Denise Edwards claimed her title insurer, Tower City Title Agency LLC of Highland Heights, Ohio, entered into a “captive insurance agreement” with First American Title that was illegal under RESPA. The lawsuit said that because First American paid $2 million for a 17.5 percent minority interest in Tower City in 1998, it received the majority of the local agent’s referral business which violated RESPA. The suit sought class action status on behalf of all consumers who purchased title insurance through a title agency that was subject to an exclusive referral agreement with First American, and damages of up to $150 million.
The case went up to the 8th Circuit Court of Appeals which sided with Edwards that “the damages provision in RESPA gives rise to a statutory cause of action whether or not an overcharge occurred.”Supreme Court review
The Supreme Court will review the constitutional issue of whether consumers must prove they were actually injured under RESPA and other truth in lending laws. A favorable ruling for First American could mean a significant dent in costly class action suits under RESPA and TILA. Oral argument is expected in the Fall term, in October.
Massachusetts impact: cozier agent relationships?
Beyond curtailing or expanding consumers’ ability to bring all sorts of claims under RESPA and Truth in Lending (TILA), a favorable result for First American could enable title companies to get into much cozier relationships with attorney agents in Massachusetts.Massachusetts is a so-called attorney agency state, where attorneys issue title insurance policies. Title insurance companies in Massachusetts cannot (yet) legally invest in or own law firms (although this rule is being challenged nationally). So we don’t have a “captive insurance agreements” or the like. Certainly, some attorney agents prefer to give their business to one or two particular title insurance companies, but to my knowledge, there’s no formal agreement among insurers and agents here in Mass.
If First American wins this case, we could see title insurance companies in Massachusetts considering captive insurance agreements and taking a much more active role in the operations of their favorite and most profitable agents. We will see….
via boston.com
New Jersey Title Insurance Linkedin Group
Saturday, June 25, 2011
Consumer agency seeks more feedback on loan disclosures | Inman News
Bureau: More than 13K comments on draft forms for simplified mortgage disclosure
By Inman News, Friday, June 24, 2011.The Consumer Financial Protection Bureau has received more than 13,000 comments on two draft proposals for a simplified mortgage disclosure form it's in the process of developing, and will be asking for additional comments on revisions it plans to post next week.
When the new loan disclosure form is finalized, it will replace the separate forms borrowers are currently provided to satisfy requirements of the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA).
The TILA disclosure form in use today, developed by the Federal Reserve, focuses on loan terms. The "Good Faith Estimate," or GFE, developed by the Department of Housing and Urban Development to satisfy RESPA requirements, is designed to help borrowers also evaluate trade-offs between a loan's interest rate and settlement service charges.
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NY Appellate Division | Bank of NY v Silverberg – MERS Does NOT Have The Right to Foreclose on a Mortgage in Default or Assign That Right to Anyone Else | Foreclosure Fraud - Fighting Foreclosure Fraud by Sharing the Knowledge
The ubiquitous Mortgage Electronic Registration Systems, nominal holder of millions of mortgages, does not have the right to foreclose on a mortgage in default or assign that right to anyone else if it does not hold the underlying promissory note, the Appellate Division, Second Department, ruled Friday. “This Court is mindful of the impact that this decision may have on the mortgage industry in New York, and perhaps the nation,” Justice John M. Leventhal wrote for a unanimous panel in Bank of New York v. Silverberg, 17464/08. “Nonetheless, the law must not yield to expediency and the convenience of lending institutions. Proper procedures must be followed to ensure the reliability of the chain of ownership, to secure the dependable transfer of property, and to assure the enforcement of the rules that govern real property.” The opinion noted that MERS is involved in about 60 percent of the mortgages originated in the United States.
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PrivoCorp - Loan Processing Experts, Contract Mortgage Processing: Florida: Sales Up, Prices Down - Contract Loan Processing : Licensed Mortgage Processor : Best Net Branch Processing : Fastest Conventional FHA Processor : Outsource Mortgage Processing
According to a report in National mortgage news,
Florida saw a 3% increase in single-family existing home sales on a year-over-year basis in May, but the median sales price fell by 5%, according to the state's Realtor group.
There were 17,228 single-family sales statewide in May, up from 16,790 one year prior. Sales in the Miami area were up 20%, year-over-year. The markets with the largest amount of sales, Tampa-St. Petersburg-Clearwater with 2,749, and Orlando, with 2,476, were down 6% and 5% respectively when compared with May 2010.
Florida's Realtors noted that the $135,500 median sales price for a single-family home was up nearly 3% over April. The Fort Myers-Cape Coral area had a 19% increase in median price when compared with May 2010, while the Panhandle metro areas of Fort Walton Beach and Pensacola were up 5% and 1% respectively.
But the median price did not go up all across the Panhandle as Panama City was off by 14%. Other areas with a large drop in median price include Gainesville, down 18%, as well as Fort Lauderdale and Ocala, each off by 17%.
Existing condominium sales in Florida increased by 17% over May 2010 to 8,338 from 7,104 and the statewide median sales price increased over the same time frame by 2% to $98,200.
In Miami, condo sales were up by 46%, and the 1,420 units sold during the month topped the 875 single family homes sold there. There were also more condos sold in the Fort Lauderdale area than single-family homes, 1,537 compared with 1,142.
Read more Visit - http://www.nationalmortgagenews.com/dailybriefing/2010_372/fla-sales-up-price...:e1421:92746a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=NMN_Daily_Briefing_062111
New Jersey Title Insurance Linkedin Group
Wednesday, June 15, 2011
American Land Title Association Market Share Analysis Shows Industry Improvement
WASHINGTON--(BUSINESS WIRE)--
The first quarter of 2011 showed improvement for the title insurance industry, according to the American Land Title Association's (ALTA) First-Quarter Market Share Analysis.
“The industry remains in a strong financial position as operating loss for the industry decreased to $11 million in the first quarter of 2011, compared to a loss of $124 million in the first quarter of 2010,” said Kurt Pfotenhauer, Chief Executive Officer of ALTA. “Meanwhile, the industry has $8.3 million in admitted assets and more than $4.75 million in statutory reserves.”
According to the Market Share Analysis, first-quarter 2011 title insurance premiums increased 8.7 percent compared to the same period in 2010 and are up 13.4 percent compared to the first quarter of 2009.
“After 13 consecutive quarters in which title premiums Written declined from the prior year's equivalent quarter, the third quarter of 2009 ended this string with an increase of 1.4 percent over third quarter of 2008,” Pfotenhauer said. “Since then, quarterly premiums written have fluctuated up and down in no discernible pattern.”
The states generating the most title insurance premiums during the first quarter of 2011 were California ($307 million, up 2 percent compared to the first quarter of 2010), Texas ($246 million, up 22.2 percent), New York ($165 million, up 17.7 percent), Florida ($159 million, up 6 percent) and Pennsylvania ($110 million, up 25.3 percent). Overall, 41 states and the District of Columbia reported increases in title insurance premiums written during the first three months of 2011 when compared to the same period in 2010. Alaska, Kansas and West Virginia all experienced more than a 30 percent jump in title insurance premiums written during the first quarter of 2011 versus the first quarter of 2010.
In terms of market share, the Fidelity Family of title insurance underwriters captured 33.7 percent of the market during the first quarter of 2011, while the First American Family garnered 27.7 percent, the Old Republic Family recorded 13.5 percent and the Stewart Family had 12.5 percent. Meanwhile, regional underwriters held 12.6 percent of the market during the first quarter of 2011, up from 10.7 percent market share during the same period a year ago.
ALTA expects to release its second-quarter 2011 Market Share Analysis around Sept. 1. Click here to view the complete First-Quarter 2011 Market Share Analysis.
About ALTA
The American Land Title Association, founded in 1907, is a national trade association representing more than 3,800 title insurance companies, title agents, independent abstracters, title searchers, and attorneys. With offices throughout the United States, 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.
American Land Title Association
Jeremy Yohe, 202-261-2938
Cell: 202-590-8361
jyohe@alta.org
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National Title Company Breaks into the Reverse Market | Reverse Mortgage Daily
National Title Company Breaks into the Reverse Market
June 13th, 2011 | by Alyssa Gerace Published in News, Reverse Mortgage | 4 Comments
There’s a new reverse mortgage title company in town. America’s Reverse Title, based in Clearwater, Florida and launched in 2010, sees the reverse mortgage market as poised for growth, and says its national title experience will lend itself to expansion in the reverse market.
America’s Reverse Title, or “ART,” is one of several companies housed under the National Title Network corporation, which primarily includes refinancing as well as both forward and reverse mortgage title divisions. Vice President of Sales Chris Beard says founders William Baumgart and Paula Pautauros entered the reverse title industry at a strategic time, especially with the slowdown of the refinancing market.
“With reverse mortgages, there’s less fallout on the purchase side. Once the counseling is started, [the loan] usually goes through, and on the title side as well. Plus, the senior market is going to be growing in the next 15-20 years, and we’re going to see a continued growth,” said Beard. ”I think what differentiates us is our long term title experience in the industry, reverse-trained closers, flat service fees, nationwide coverage and commitment to build strong relationships with our reverse producers.”
Baumgart and Pautauros are the former founder/CEO and senior vice president, respectively, of TransContinental Title Company, which was sold to First American Corporation in 2006.
National Title Network already works with some large lenders, including TD Bank and Mortgage Investors, and now ART is pursuing Wells Fargo reverse producers, Beard says. ART’s services include providing property reports, title searches, title insurance, deed recording, escrow agency and all other services required to close mortgages, and the company expects the majority of the its closings will be refinances in which borrowers obtain a reverse mortgage loan. ART can close in all 50 states as well as the Dominican Republic.
Written by Alyssa Gerace
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With so few HECMs for Purchase what is the significance of this statement: "With reverse mortgages, there’s less fallout on the purchase side?" Compared to what? That response always comes up when the issue of high costs arise. It is at least as appropriate here.
Then comes: "Once the counseling is started, [the loan] usually goes through...." Where is this stuff coming from? James Veale has stated that using a four month lag principle HUD stats show that in the last 39 months only 74% of all apps which received FHA case numbers (that means AFTER counseling) ever got endorsed. When I was in school that was a C at best. Would they say the same if the rate was only 50%? Worse, recently I calculated that the conversion rate is dropping slightly down closer to 73%.
So how is that a great pull through or conversion rate? These folks seem to be novices in the reverse world. Their overenthusiastic statements seem to bear that out.
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Huh? HECM drop out rates are lower than the drop out rate for forward mortgages --- following counseling? I did not know those borrowers took counseling. It seems you have stumbled into a new truth. That is exactly what I meant by compared to what.
Not long ago RMD ran a survey on the percentage of borrowers who do not close a HECM following counseling. Well over 50% of respondents believed it was 20% or less. The truth is it is 27% following FHA Case Number assignment alone. The only stats I have are those related to FHA Case Number assignments. It does not include counselees who never reach the assignment stage.
Facts are facts. It is not negativity. Interpreting our endorsement rate as a C is not negative. It seems you are calling the forward drop out rate as worse. But again, compared to what?
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