Update: Issuance of Final Policies

Policy transmittal and remittance lag, closing insight, lender communications, third party certification, FAR-BAR contract

Dear Fund Member:

This email is longer than usual and for that I do NOT apologize because there is so much going on!

Policy transmittal and remittance lag:

Dealing with the “follow-up” required after a real estate closing is a real challenge for practitioners. The pressure to focus on the next closing is immense and all Members have come up with their own way of structuring their offices to get disbursements made and documents recorded so that their staff can move on to getting the next deal closed.

My message today focuses on handling the issuance of the final policies. Why? Because issuing the final policies seems to be treated as the very last step by many of you before a file is closed. Our records show that Members have policy lag times of 120 days, 6 months and even MORE THAN A YEAR. When this came to my attention, I became very concerned about these Members staying on a lender’s approved closing agent list. Lenders have always monitored receipt of the final policy and they will continue to do so – they have a record of how long it takes you to get them that policy! In my opinion, this will get more scrutiny in the near future and if you are one of those that takes too long, you may get taken “off the list.” I know you are busy. I know you don’t want to hear this, but you need to make a change in your process to issue those policies and remit the premium.

Closing Insight:

I covered this in a recent email but I am doing it again because it is so important. Please register with Closing Insight ASAP. You need to be registered to handle closings for the big lenders and registering will also get you in the pipeline for being trained in plenty of time before you first have to use it. Here is the link to register your firm/agency: www.closinginsight.com. Leslie Anderson at The Fund has been designated as your resource for questions and she can be reached at landerson@thefund.com. Have patience with her as she is learning along with all of us about the details of Closing Insight!

Lender communications:

Bank of America has issued an updated communication about their anticipated process post August 1, 2015. A PDF version of this document is posted on the Readiness page.

Highlights include confirmation that BOA will require use of the separate Seller Closing Disclosure, that Settlement Agents must be registered with Closing Insight to handle a closing and that closing instructions will be amended to incorporate requirements of the new rules. Read your closing instructions carefully to make sure you understand what is required of you.

Third-party certification of Best Practices

Iberia Bank (and several others) has recently indicated that it will require third-party certification that their Settlement Agents comply with Best Practices. This is an important event and while the larger lenders (Wells Fargo, Bank of America and others) are NOT requiring third-party certification, you should be aware that for some lenders this may be a requirement. You will need to evaluate whether the cost of the certification is justified in light of the expected business volume from that lender. In addition, there might be a delay in your ability to get the certification because of a requirement that you demonstrate compliance with Best Practices for a minimum period of time, e.g., three months.

Changes to FR/BAR contract:

This standard contract form has been amended (final approval by all parties is expected on July 1) to accommodate some important aspects of the new CFPB residential mortgage loan closing rules (TRID). The effective date of the new contract form will probably be September 1, 2015. I am working with members of the RPPTL Section of The Florida Bar to schedule a one hour webinar to present and explain the changes. The expected date is sometime in August. Keep on the lookout for announcements from RPPTL about this opportunity and to register if you are interested.

Please do not forget about our CFPB Hotline to help you with questions related to the new CFPB rule: cfpbfaq@thefund.com and 1-844-237-2327.

I hope you have found this email to be helpful. Thank you for all that you do in support of The Fund!

Best Regards,

Melissa Jay Murphy
Senior Vice President and
General Counsel