We can be a big help with all the big changes you’re facing.
As a mortgage lender, you know better than anyone else the changes facing all the participants in the real estate transaction. You can rest assured that Sandpoint Title Insurance along with our underwriter, Stewart Title, is ahead of the curve. Upon the release of the proposed mortgage and closing disclosure rule on July 9, 2012, our CFPB task force immediately began evaluating the legal aspects of the rule and initiating the process to account for the various possible scenarios outlined within the proposed rule.
We are updating our associates on an ongoing basis and working with a variety of industry experts to analyze all possible scenarios resulting from the mortgage disclosure rule and other CFPB regulations affecting the real estate transaction.
We have been working within our office to:

  • • Mirror current transactions using the new forms
  • • Determine the workflow under the three-day rule

We’ve been working hard to ensure our ongoing compliance with the latest CFPB regulations and know you’re doing the same. To help you stay ahead of the game, we’ve compiled a few of the key rules and requirements affecting lenders, service providers and title agents, along with the newest industry recommendations for maintaining quality and compliance.

How will the latest CFPB regulations affect you?
Under the Consumer Financial Protection Bureau (CFPB) regulations, there are a number of recent rules and regulations that affect both bank and non-bank lenders, three of which will greatly impact your real estate transactions.

First, in accordance with the April 2012 service provider bulletin, lenders are required to maintain ongoing oversight over their service providers to ensure their compliance with consumer financial law. To this end, lenders are expected to implement appropriate processes when performing due diligence on their service providers, specifically when reviewing their providers’ training policies, monitoring procedures and compliance controls. Under the CFPB’s supervisory and enforcement authority, lenders are expected to act quickly and appropriately should they identify problems with their service providers’ procedures.

Second, the integrated disclosure rule aims to protect borrowers from high-risk loans by integrating the consumer disclosures required under RESPA and the Truth-in-Lending Act (TILA). The new documents include a loan estimate form and a closing disclosure form, both of which must be delivered within specific time frames under specified conditions. The final version of this rule was released November 20, 2013, and goes into effect on August 1, 2015.

Finally, in an effort to protect buyers against predatory loans, the CFPB ability-to-repay (ATR)/qualified mortgage (QM) rule requires creditors to “make a reasonable, good faith determination of a consumer’s ability to repay any consumer credit transaction secured by a dwelling”. The rule dictates that “qualified mortgages” must not contain fees over 3% of the loan, extend beyond a 30-year term, include interest-only payments or be issued to borrowers whose debt payments exceed 43% of their income. Lenders can issue loans that don’t meet these criteria but they will not have the same legal “safe harbor” as the loans meeting these requirements.

With ALTA’s best practices, title agents can better serve you while staying CFPB-compliant.
In July 2013, the American Land Title Association® (ALTA®) released its Title Insurance and Settlement Company Best Practices guide for independent agents. These guidelines advise agents to ensure quality service and CFPB compliance by establishing written procedures and controls for their title policy, and escrow and real estate settlement processes; as well as by maintaining all industry-mandated licenses and insurance coverage required to conduct business.

Find a service provider you can trust.
As a Stewart Trusted Provider, we’ve been verified by what our underwriter believes to be the industry’s most rigorous vetting process. In order to qualify as a Stewart Trusted Provider, we’ve passed an intensive due-diligence screening and undergone strict, ongoing monitoring to ensure we meet the highest standards for quality and compliance. Lenders and consumers can depend on Stewart Trusted Providers to provide a quality experience throughout the real estate transaction process consistent with the coverage provided in Stewart’s Closing Protection Letters and Policies of Title Insurance as issued. When you see the Stewart Trusted Provider seal, you’ll know you’ve found a provider you can trust. Visit stewart.com/agencytrust to learn more about the screening and monitoring we’ve undergone.

Visit stewart.com/cfpb to learn more about the CFPB and ALTA Best Practices, or contact us today with any questions you may have about the CFPB regulations.