TAN Members Dominate TRID Comments to CFPB

October 18, 2016

Members of the Title Action Network (TAN) overwhelmingly have been the most active providing comments to the Consumer Financial Protection Bureau’s (CFPB) proposed amendments to the TILA-RESPA Integrated Disclosure (TRID) rule.

Of the more than 1,300 comments on the Regulations.gov website regarding the TRID changes, 83 percent have been submitted by TAN members sharing industry concerns. TAN members have asked the CFPB to correct the inaccurate disclosure of title insurance fees, stop lenders from shifting liability to settlement agents and to provide more guidance on sharing Closing Disclosures.

The CFPB’s proposed changes correct technical problems, add clarity and incorporate informal guidance provided by the bureau in webinars into the official staff commentary. The CFPB said it did not intend to revisit major policy decisions in this rulemaking. Because of this, the proposed changes do not correct the inaccurate disclosure of title insurance premiums.

Cara Detring NTP of Preferred Land Title in Missouri told the CFPB that it missed an opportunity to correct the calculation of title fees on the Closing Disclosure.

“Consumers around the country continue to receive inaccurate information at the closing table about their title insurance costs,” she said, adding that Missouri’s Department of Insurance, Financial Institutions requires title fees to be quoted a certain way.

“This just adds to the confusion because fees for title insurance and settlement are actually quoted differently,” Detring wrote. “This provision of the rule defeats the Bureau's own mission to provide consumers with a better understanding of their transaction and disregard of State statutes and regulations causes more confusion.”

Joyce Huddleston of Greeley County Abstract & Title in Kansas said the bureau’s rule for disclosing title fees is “totally irresponsible” and is not helpful to the consumer. In addition, she said the CFPB must address privacy issues regarding the Closing Disclosure.

“The CFPB has added to the confusion on sharing the Closing Disclosure throughout the real estate industry,” Huddleston wrote. “In (the CFPB’s) proposed rule, you did not address the intricate issue of privacy with reference to state law and private contracts. It's vital to the real estate community, and thereby consumers, that you provide clear and accurate guidance on sharing the Closing Disclosure.”

Sylvia Smith of Western Title Company in Nevada informed the CFPB that her company holds regular meetings with staff to educate them on the importance of reading the lenders instructions to make sure that undue liability is not shifted.

Smith indicated that in the Nevada market sellers pull the plug quickly on transactions that don’t close with a certain period of time. Buyers become stressed because documents are late and pressure mounts on the settlement company to close the transaction “or face the liability from the parties—let alone the loss of business—if we delay the closing while we battle with the lender.”

“The fact that the lender can pass liability onto the settlement agent for their non-compliance with TRID is unfair,” Smith said in her comments. “We should be held accountable for our role in the transaction, but it is not fair to the borrower or the settlement agent for the lender to be able to shift their liability to another party. The CFPB has indicated verbally that the lenders cannot do this, unless agreed to between the lender and third party vendor. This needs to be clarified without question that the lender cannot and should not be able to shift their liability to the settlement agent.”

There’s still time to take action. The deadline to comment on the proposed amendments is Oct. 18.

Comments may be sent by:

  • Email: FederalRegisterComments@cfpb.gov. Include Docket No. CFPB-2016-0038 or RIN 3170-AA61 in the subject line of the email.
  • Electronic: http://www.regulations.gov. Follow the instructions for submitting comments.
  • Title Action Network: Visit www.titleactionnetwork.com and click “take action” to comment to the CFPB directly using our pre-drafted information or customize your own message. Not a member? Join today. 

Please share your thoughts on the proposed changes with ALTA at TRID@alta.org.

“As the industry that sits at the closing table with millions of homebuyers each year, ALTA encourages our members to submit comments to the bureau staff to ensure homebuyers understand their real estate transaction,” said Michelle Korsmo, ALTA’s chief executive officer.

Contact ALTA at 202-296-3671 or communications@alta.org.