January 2010


Dear ,

What is it with government and December filing deadlines? Over the holidays, TLTA filed comments with the Texas Department of Insurance (TDI), the State Office of Administrative Hearings (SOAH), and the Federal Reserve regarding various policy issues.

TDI, along with TLTA and other stakeholders, has been working diligently to formulate rules for the implementation of House Bill 4338 regarding agent insolvency. Last month, TDI informally proposed rules and asked all stakeholders to submit their comments by the 28th. The proposed rules fall short of a workable solution for meeting the mandatory minimum capitalization requirements, however relative to other aspects of HB 4338 rules, are much improved. We’re grateful for TDI’s continued willingness to discuss these rule drafts prior to their publication in a more formal process. This approach has no doubt been helpful with the flow of information between the department and stakeholders, resulting in an efficient and quality oriented process. TLTA’s board has adopted a proposed approach to minimum capitalization which it believes will resolve the present impasse with the department and we look forward to our continued discussions.

In regards to the Biennial Rate Hearing, TLTA and other industry parties to the hearing filed exceptions to SOAH’s proposal for decision last week in an effort to urge the judges to reconsider certain elements that would result in a higher recommended rate increase. The proposal for recommendation articulates the Administrative Law Judges’ reasoning for their recommended 2.66% rate increase. I encourage you to read these filings as they are discussed below.

On the federal front, the Federal Reserve placed a December 24 due date for comments on their proposed changes to the federal "Truth in Lending” regulations. The proposed change to Regulation Z would require title insurance costs to be rolled into the APR. This would create problems for consumers as well as title services providers.We provided comments incorporating those made by ALTA, but also pointed out the unique impact the rule would have on Texas consumers.

In wrapping up, we continue to aggressively battle the inclusion of “settlement service providers” in the Consumer Financial Protection Agency (CFPA) bill. As we have previously reported, the Senate version of the bill contains both “title insurance” and “settlement service providers.” It is unclear how Chairman Dodd’s decision not to seek re-election will play into the timetable and eventual success of the CFPA bill in the Senate, however, conventional wisdom indicates it will help the bill move along as the Chairman will have less incentive to take on the Federal Reserve and other challenges to the President’s approach to the bill. We can probably expect to see movement on the bill later this month absent intervening events.

Hopefully you were able to rest-up over the holidays, because the coming year is guaranteed to be busy with the upcoming Sunset Advisory Commission review, the House Insurance Committee interim study meetings and post-session TDI rule hearings.

Sincerely,


Aaron Day

REGULATORY NEWS - TDI

2008 Agent Statistical Data Now Available

The 2008 Agent Statistical Data is now available on the TLTA website. Please note this is only the agent data; the underwriter statistical information will be available later this spring. If you have any questions please contact TLTA at 512.472.6593 or tlta@tlta.com.

Changes to Basic Manual Effective February 1, 2010

TLTA Provides Tools for Compliance
Last week, TLTA published a chart outlining the February 1, 2010 Basic Manual changes. This new resource is the first of its kind to be published by TLTA and it’s designed with your needs in mind. The simple layout allows you to quickly analyze and orient yourself with the changes, while the in-depth analysis serves as a launching point for further study. We also encourage you to review the history of the creation of the rules and forms, including their justifications and earlier versions.

As you review the changes it’s important to note the following:

There are some significant and positive options for title agents including the incorporations of changes in the law allowing you to pass through electronic filing charges and third party tax search fees, as well as the ability to charge for the furnishing of title evidence in a P-24 transaction which does not close.

There are also several new endorsements with which you should become familiar.

Agents will be required to develop and review annually a plan for winding down their operations, as well as maintaining auditable records relative to the furnishing of title evidence to clients.

View a printable version of TLTA’s 2008 Biennial Rule Hearing Analysis Chart

Register Now!
Webinar: Revisions, Additions & Deletions to Texas Rules & Forms effective February 1, 2010
Tuesday, January 19 l 1:30 – 2:30 p.m. CST
Be sure you are up-to-speed on the changes to 19 forms in the Basic Manual that will go into effect on February 1, 2010. Our knowledgeable presenters will walk you through the new endorsements, highlight changes and help you prepare in this timely presentation.

Register OnlinelView Program Brochure

Basic Manual Subscription Service

 The Basic Manual Update Subscription service is just one of your member benefits and provides the most cost-effective and efficient means to ensure your Basic Manual is always in compliance. As part of the Texas Department of Insurance's current audit procedures, they require proof of a current up-to-date Basic Manual.

Stay in compliance, save money and stop guessing!Become a Basic Manual Update subscriber today and receive all of the updates for 2010.

View Other Basic Manual Products

SOAH Judges Recommend 2.66% Rate Increase

TLTA Files Proposal Exceptions

As we reported earlier, the State Office of Administrative Hearing (SOAH) judges issued their proposal for decision to the Commissioner of Insurance in mid-December.

The judges have proposed a recommended a 2.66% increase in the basic premium rates for title insurance in Texas. It is important to note that this is only a recommendation and is not a final ruling. The judges’ recommendation has been sent to Commissioner Mike Geeslin, who will consider it and render a final decision. We are hopeful that this recommendation and the additional comments from TLTA and the title industry will result in a much needed rate increase.

Having disagreed with many aspects of the proposed recommendation, TLTA and other parties to the hearing have filed their proposal exceptions this week.View TLTA’s SOAH proposal exception or view other parties’ proposal exceptions.

If you have any questions, please contact TLTA’s Director of Government Affairs Aaron Day at aaron@tlta.com

FEDERAL NEWS

HUD Releases Tenth Installment of RESPA Rule FAQs

Last week, the Department of Housing and Urban Development (HUD) released its tenth installment of the new RESPA rule FAQs.

This new installment includes answers to previously submitted questions, along with updated guidance to a question surrounding a written list of settlement services providers on the Good Faith Estimate (GFE). This new guidance, found on page 12 of the installment, will help aid in the completion of the GFE, written List of Settlement Services providers, and preparation of closing instructions, and assist the title industry in completing the HUD-1.

As you review the installment, please note that any new or updated information will be bolded As we reported earlier, HUD has said they will "exercise restraint" in enforcing the new RESPA rules for the first four months of the year.

Recommended Education On RESPA-Ask a Question-More Information

Senate Banking Chairman Chris Dodd Retires

Last Wednesday, Senator Chris Dodd announced that he will retire from the Senate when his term expires, thus ending a four-decade career in Congress.

As we reported in the December Dateline, Chairman Dodd has filed a Consumer Financial Protection Agency bill in the Senate. Unlike the House version, Dodd’s bill includes references to both “title insurance” and “settlement services” in the definition of “financial activity.” If passed without the necessary amendments, this bill would create an agency which would levy taxes directly on the regulated individuals from the largest underwriter to the smallest agent. Additionally, it would open up a new universe of federal regulation for our industry. The Senate Banking Committee is expected to hear the bill sometime later this month or in early February.
TLTA is continuing to work hard to rectify the fundamental misunderstanding of the nature of real estate closings at the federal level. We will continue to update you things develop.

JUDICIAL NEWS

Texas Supreme Court Overturns Myrad Case

Last year, the TLTA Legal Issues Committee filed an amicus letter with the Texas Supreme Court in the Myrad Properties v. LaSalle Bank National Association court case. This particular case dealt with a more expansive use of a correction deed which would have created serious problems for title searches and ownership determination by allowing correction deeds to substantively redefine the status of property ownership. Fortunately, the Texas Supreme Court overturned the decision made by the Court of Appeals.
View Texas Supreme Court Ruling No. 08-0444

TLTAPAC

$50,287 Needed to Reach Annual Fundraising Goal

Over the coming months, the TLTAPAC will be announcing some new and exciting ways for you to support your industry. There are plenty of ways to show support for the TLTAPAC, one of the easiest ways is volunteering to help with fundraisers. For example, Kelly Caskey’s first TLTAPAC foray came in the form of helping solicit items for the 2009 TLTAbay Auction. With Kelly and other TLTAbay Committee members’ help, we raised over $20,000 worth of items for the annual auction, which resulted in raising almost $14,000 for the TLTAPAC. If you still need a reason to support the PAC, consider one of these:

I Give Because...

Title insurance in Texas insures the dream of home ownership for Texans statewide. We have some of the strongest homestead laws in the nation and the job title companies do is an important one.
The TLTAPAC helps nurture an open forum with our elected officials and allows us to serve as a resource when certain bills affecting our industry and consumers are discussed.
We must keep Texas’ legacy strong and independent. By supporting the TLTAPAC, I become an integral part of keeping those laws strong and helping to insure Texas' heritage for future generations.


Kelly CaskeyTriCentury Title, LLC

NEWS TO KNOW

Industry Stats

Release Date

Latest Release

Change from Previous Release

30 Year Fixed Mortgage Rates

01/07/10

5.09%

+0.04

15 Year Fixed Mortgage Rates

01/07/10

4.50%

+0.05

10 Year Treasury Rate

1/11/10

3.85%

+0.02

Existing Home Sales (in millions)

12/22/09

7.4

+10.1%

New Home Sales

12/23/09

355,000

-9.0%

Supply of Housing Inventory

12/23/09

7.9 months

+15.2%

Information Provided by ALTA.

TLTA News Ticker - Providing You the Latest in Industry-Related Newsws

Monday through Friday you can count on TLTA for the latest business and industry news clips in Texas and across the United States. Check out the TLTA News Ticker today!