In April, 2012 the federal Consumer Financial Protection Bureau (CFPB) released a bulletin regarding "service providers". The bulletin indicates that the CFPB expects lenders to "have an effective process for managing the risks of service provider relationships."
The Fund has recently learned that some lenders have elected to respond to the CFPB bulletin by requiring title and settlement agents be "vetted" by independent third parties. New businesses have been created to evaluate, report on and "certify" title and settlement agents and each of their closers to the lenders. One such company we know of charges $200 to $300 each year for each entity and individual to be evaluated.
The Fund recognizes the impact of this requirement on title agents. Through the American Land Title Association we are participating in discussions on the state and federal level to address the certification requirements of the lenders. As discussions continue to evolve, it may become clearer as to what might satisfy this "effective risk management process" as it relates to title insurance agents. The Fund does not support or endorse any particular vendor of these evaluations services. Each member presented with the lenders' requirement must elect whether to participate.
The Fund is completely committed to preserving and facilitating the real estate practices of Florida attorneys. Through active participation in ALTA discussions with federal regulators The Fund will continue to be the voice of Florida real estate with a message that independent title agents, including attorney agents, are critical to providing consumers with the choices that encourage competition and protect the public's interests.