September 20, 2011
The CLTA sent a letter to Elizabeth Warren, a special advisor to the President and to the Secretary of the Treasury on the Consumer Financial Protection Bureau (CFPB). The CLTA letter addressed the numerous problems and inconsistencies of the new proposed form which attempted to combine the requirements of the Truth in Lending Act and the Real Estate Settlement and Procedures Act’s Good Faith Estimate into a single form. The CLTA letter explained that title company operations vary widely in different parts of the country, especially in regards to the owner’s policy. It was noted that the owners policy description is now included in the “other title” charges section rather than as its own separate line item. It was noted that the Texas Land Title Association sent a similar letter to Professor Warren.
Since the CLTA and TLTA letters were mailed to the CFPB, the forms have undergone a third draft and are anticipated to undergo other subsequent drafts as well. Industry veteran Don Partington mentioned that he thinks that we may see two or three more drafts of the form before it is finalized and believes that the CLTA may need to send an additional letter as subsequent drafts are released. Mr. Partington also stated that the CFPB mentioned that the CLTA and TLTA letters were very helpful in pointing out the regional differences encountered by title and escrow professionals, making the “one size fits all” form much more difficult to implement.
The CLTA will continue to work closely with Mr. Partington and the ALTA in providing future comments to the CFPB to hopefully nudge them into making any necessary changes to limit the negative impact on California title companies.
The ALTA has issued a grassroots alert asking members to comment on the fourth and expected final version of a combined TIL and GFE.