The Association for Title Information Management (ATIM) held its 30th annual conference September 27-29 in beautiful Squaw Valley, CA, home of the 1960 Winter Olympic Games.
Here is my recap of the very informative sessions:
CFPB Impact on Title Plants
With CFPB implementation looming, Diane Evans (ALTA president and Vice President at Land Title Guarantee) and Penny Reed (Vice President at Wells Fargo) began the conference with a discussion on protecting non-public personal information (NPI).
Penny addressed the need to protect data in transit, data at rest, and data in use.
ü System to system connections must be secure. Vet your providers (e-Recording vendors and Recording offices passing documents directly to you) plus business partners (title plant subscribers) so that no one can exploit a weakness in a third party network to get to you. This may be less of a concern if the data is public as is the case with recorded documents, but verify that nobody can get to trust account information etc. via the title plant.
ü Transaction information required to perform a search prior to closing that is not public record (buyers names, purchase price, property) is absolutely considered private and must be protected from outside sources and employees not needing to use it. Some are masking this type of information in order generation software and storage systems.
ü Encrypt data in transit via email encryption tools.
Diane referred to ALTA’s best practice pillars as a resource. Both reminded the group of CFPB’s long reach and that it is funded solely through fines levied. You need be able to describe and defend your practices in the event the chain of a breach leads back to you.
Both provided examples of hazards happening in the industry today:
ü Thieves are monitoring title orders trying to figure out when money will be deposited, wired etc. and hacking into accounts. Or they will change one letter or number of a party’s email account and send bogus wiring instructions to a lender, realtor or settlement agent.
ü Ransomware attacks.
ü Realtor email accounts seem particularly vulnerable to hacking and are being used to get access to other information.
Uniform Filing Fees:
Under the new CFPB regulations when closing costs fall outside compliance, lenders must refund over payments and absorb under payments. Also they are subject to penalties that could reach thousands of dollars per day/per instance if they are found non-compliant.
With approximately 3,600 recording jurisdictions in the United States, recording fees are very difficult to obtain and track. A round table consisting of recording staff from four jurisdictions and Penny Reed from Wells Fargo discussed the importance of creating predictable recording fees. A few areas have instituted flat rate recording fees statewide. For example, $46 per document whether it is one page or twenty. Most participants were open to the idea although the path to getting there will likely take time, a fee study and new legislation.
Redacting Public Records
Redaction of information from public records has grown from removing items like SSNs and credit card numbers on recorded documents to removing the names, addresses, and legal descriptions of entire groups of people such as public servants and abuse victims. Whereas nobody wants to deny protection to those who need it, the integrity of land records must be retained. Missing records have a detrimental effective on the ability to run a complete chain of title and insure property.
The session included an update of legislative trends across the country and brain storming alternatives. Famous people who make a living in the public eye often utilize trusts rather than take title in their name, but this can be expensive and confusing to the general public.
A panel described an emerging trend of basing some underwriting decisions on search engine scoring results and other alternative methods to the traditional collection and review of land records. The idea is not to replace examiners, but to utilize software that analyzes data from several sources then scores and ranks risk in order to facilitate routing the difficult orders to the most experienced examiners. An example given was using credit report information on GI searches. A search on a very common name could return numerous liens. Rather than examining all of them, a determination could be made that your party/purchaser, with a 750 credit score, is low risk – either not the same person or likely to pay the debt if he/she is that person. Credit information, such as current/previous addresses and employers helps prove or disprove you party as being the same person with a lien.
Title Plant Variances
A discussion on different types of title plants used throughout the country for examination such as thin, thick, and starters. The differences were discussed along with pros and cons of each and impact, if any, on claim rates.
Economic Perspectives 2015
Pat Stone, CEO of Williston Financial Group, shared his insight on areas impacting real estate and title insurance industries. The presentation included a recap of GDP through Q2 of 2015, the changing landscape of single family home building, unemployment rate versus underemployment, trends in housing starts and other issues/challenges. His overall economic outlook seemed optimistic although he stated that ‘all bets are off’ if another government shutdown happens.
Interested in getting more information on ATIM? Contact me or visit the web site: www.atim.org