October 2, 2019

In This Issue:

  • TLTA Submits Rule Proposals to TDI
  • Job Opening: Title Insurance Specialist
  • U.S. House Approves Cannabis-Related Banking Legislation Designed to Give Certainty to Businesses Operating in States Where Marijuana Is Legal
  • Treasury to Allow Fannie Mae, Freddie Mac to Retain $45 Billion in Capital
  • Appraisals Will No Longer Be Required on Certain Home Sales of $400,000 and Under

TLTA Submits Rule Proposals to TDI

TLTA | Oct. 1, 2019
Earlier this year, Insurance Commissioner Kent Sullivan issued a request for help identifying specific agency rules that need to be updated or changed. Rule proposals were due Oct. 1.

In response to TDI's request for feedback, TLTA submitted this package of recommendations. Under the guidance of TLTA's Regulatory Committee, chaired by Peter Graf, and with the endorsement of TLTA's Board of Directors, who approved these suggestions last week, our recommendations are predominately fine-tuning revisions of ideas and rules previously approved by the Board. There are a handful of new proposals in this package. For example, we are recommending elimination of the severable improvement endorsement, and the addition of an energy project endorsement package. 

Review TLTA's Submission to TDI  »

TDI Job Opening: Title Insurance Specialist

TLTA | Oct. 1, 2019
The Texas Department of Insurance has a job opening that might interest you or someone in your professional network. The agency is hiring a "Title Industry Specialist" with meaningful title insurance experience. 
Read TDI's Posting and Apply »
If you have questions, please contact TDI's David Muckerheide

U.S. House Approves Cannabis-Related Banking Legislation Designed to Give Certainty to Businesses Operating in States Where Marijuana Is Legal

James E. Hyland, TLTA Federal Legislative Counsel | Sept. 30, 2019
On Sept. 25, the U.S. House passed H.R. 1595, which would make it legal for banks, credit unions, insurance companies and other financial services providers to service cannabis-based businesses without running afoul of federal law. Cannabis remains illegal under federal statutes, but legal under some state’s laws, including Texas under its Compassionate Use Program. Ninety-one Republicans joined all but one Democrat to pass the bill 321 to 103.  

While this is not a pervasive front-line issue in Texas, there are secondary impacts that may affect Texas’s title industry. 

As pointed out in testimony on Feb. 13 before the U.S. House, indirect connections to marijuana revenues are hard, if not impossible, for financial companies to both identify and avoid. Like almost every other business, the cannabis industry is dependent upon any number of vendors and suppliers to function. These are everyday businesses, like the printing company that makes business cards, the office supply company that fulfills orders for pens and copy paper, the housekeeping crew or landlord that cleans or rents office or retail space, and even the utility company that provides that space with water or electricity. Under the existing status quo, a bank, credit union or financial company, including a title insurance company, that does business with any one of these indirectly affiliated entities could unknowingly risk violating the federal Controlled Substance Act, USA Patriot Act, Bank Secrecy Act, and/or the Racketeer Influenced and Corrupt Organizations Act, among other federal statutes.   

House passage of H.R. 1595 was less about the merits of marijuana legalization than it was driven by the business community’s need for legal certainty, particularly in states where some form of cannabis is legal, such as Texas.
Read More »

Treasury to Allow Fannie Mae, Freddie Mac to Retain $45 Billion in Capital

HousingWire | Sept. 30, 2019
The Department of the Treasury and the Federal Housing Finance Agency announced Monday it will now allow the government-sponsored enterprises to retain up to $45 billion in combined capital as they prepare to leave conservatorship.

Earlier this month, Treasury Secretary Steven Mnuchin said the administration is currently looking to end the profit sweep of Fannie Mae and Freddie Mac.

Mnuchin explained that not only was President Donald Trump trying to end the profit sweep, but he was looking to do it soon.

“We are actively negotiating an amendment to try to get it done by the end of the month,” Mnuchin said at the time.

Now, the FHFA and the Treasury made a joint statement saying the GSEs will be allowed to retain capital as the administration continues to work toward ending conservatorship.

“The enterprises are leveraged nearly 1,000-to-one, ensuring they would fail during an economic downturn – exposing taxpayers once again,” FHFA Director Mark Calabria said.
“This letter agreement between Treasury and FHFA, which allows the enterprises to retain capital of up to $45 billion combined, is an important milestone on the path to reform.”
Read More »

Appraisals Will No Longer Be Required on Certain Home Sales of $400,000 and Under

HousingWire | Sept. 27, 2019
For the first time since 1994, certain home sales of $400,000 and under will soon not need an appraisal after federal regulators approved a proposal to increase the threshold at which residential home sales require an appraisal.

Last November, the Federal Deposit Insurance Corp., the Office of the Comptroller of the Currency, and the Board of Governors of the Federal Reserve released a proposal that would increase the appraisal requirement from $250,000 to $400,000, meaning that certain home sales of $400,000 and below would no longer require an appraisal.

The agencies deliberated the rule for nearly a year, taking into consideration the more than 560 comments the agencies received about the rule change.
Last month, the FDIC and OCC signed off on the rule, but were still waiting on the Fed to approve the rule change as well.

Now, the Fed has also given the rule change its stamp of approval, and with all three agencies signing off, the appraisal rule change will soon go into effect.

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