The November CLTA enews reported that the U.S. Supreme Court agreed to hear a property owner’s case claiming that just because a building-permit exaction is authorized by legislation does not make it exempt from an unconstitutional taking. The case has now been decided in favor of the landowner in a ruling that the Fifth Amendment against government takings does not have a legislative exception. Courts had differed over whether a legislatively authorized exaction makes the conditions exempt from a takings claim.

The case involves a building permit in El Dorado County, California for a manufactured home where the County required the owner to pay over $20,000 as a condition of approving his building permit. The fee was authorized under the County’s Traffic Impact Mitigation (TIM) Fee Program.

Still at issue is whether the traffic impact fee would be compensable if it is imposed outside the permitting context, as well as whether a permit conditions that affects a class of properties must be tailored similarly to a permit that applies to a particular development.

Over one-third (34.5%) of U.S. home purchases in February were made with all cash according to Redfin, up from 33.4% a year earlier, and just shy of November 2023’s 34.8% decade-high and not that far below the record high of 38% hit in 2013. Redfin defines an all-cash purchase as a home purchase with no mortgage loan information on the deed. All-cash purchases were least common in the higher-priced metro areas of San Jose (18%), Oakland (21.6%), San Diego (21.7%) and Los Angeles (23%). Jacksonville, FL, at 54.4%, had the highest share of all-cash purchases among the metro areas that Redfin analyzed.  

“High mortgage rates are widening the wealth gap between people of different races, generations and income levels,” said Redfin Economics Research Lead Chen Zhao. “They’ve added fuel to the fire lit by surging home prices during the pandemic, creating a reality where in many places, wealthy Americans are the only ones who can afford to buy homes. Meanwhile, people who are priced out of homeownership are missing out on a major wealth building opportunity, which could have financial implications for their children and even their children’s children.”

The results of Freddie Mac’s Primary Mortgage Market Survey® (PMMS®), released last Thursday show the 30-year fixed-rate mortgage (FRM) averaged 6.88 percent. The survey is focused on conventional, conforming, fully amortizing home purchase loans for borrowers who put 20% down and have excellent credit.

“Mortgage rates have been drifting higher for most of the year due to sustained inflation and the reevaluation of the Federal Reserve’s monetary policy path,” said Sam Khater, Freddie Mac’s Chief Economist. “While newly released inflation data from March continues to show a trend of very little movement, the financial market’s reaction paints a far different economic picture. Since inflation decelerated from 9% to 3% between June 2022 and June 2023, the annual growth rate of inflation has remained effectively flat, ranging from 3.1% to 3.7% and averaging 3.3%.”

Rates:

• The 30-year FRM averaged 6.88 percent as of April 11, 2024, up from the prior week when it averaged 6.82 percent. A year ago at this time, the 30-year FRM averaged 6.27 percent.
  
  
• The 15-year FRM averaged 6.16 percent, up from the prior week when it averaged 6.06 percent. A year ago at this time, the 15-year FRM averaged 5.54 percent.

The U.S. Circuit Court of Appeals in D.C. ruled that the Department of Justice (DOJ) can reopen its investigation into the National Association of Realtors (NAR). NAR took the position that the settlement agreement reached with the DOJ in November 2020 barred the DOJ from further investigation into NAR's Participation Rule and Clear Cooperation Policy. The majority opinion of the Court of Appeals emphasized that the DOJ's closing letter did not explicitly prevent reopening the investigation. Under the Biden Administration the Department of Justice had withdrawn the settlement agreement in July 2021. NAR then challenged the withdrawal in court and a U.S. District Court initially ruled in favor of NAR, until the Court of Appeals ruled in favor of the DOJ.

On March 26th the California Department of Housing and Community Development (HCD) notified the Town of Portola Valley that HCD revoked its January 30, 2024, finding that it's housing element was in substantial compliance with State Housing Element Law. Portola Valley is the first local government to have its substantial compliance determination revoked by HCD.

HCD notified Portola Valley that its response to HCD’s written findings of noncompliance failed to demonstrate implementation of certain programs included in its housing element, and that it was therefore no longer in substantial compliance with State Housing Element Law.

Portola Valley has indicated that its next step is the adoption of the Zoning Code and Zoning Map amendments that will facilitate the implementation of numerous Housing Element programs. These programs include codifying the Affiliated Housing Program, and ensuring compliance with state legislation addressing group homes, emergency shelters, and reasonable accommodation procedures.

Noncompliance puts the Town of Portola Valley in a situation where a developer could seek to invoke the Builder’s Remedy. The Builder’s Remedy is part of the State Housing Accountability Act. It allows developers to obtain permits without approvals from the planning commission and allows them to bypass zoning rules if a percentage of units are provided at below market rates. Pending legislation, Assembly Bill 1893 (Wicks), would clarify and strengthen the provisions of the Builder’s Remedy law to make it a more effective tool and avoid litigation.

Texas-based Title Resources Group (TRG) has entered into a definitive agreement to acquire Doma Title Insurance, Inc. (Doma) for about $85 million. The transaction is expected to close in the second half of 2024, pending certain closing conditions, and regulatory and other approvals. Doma was known as States Title prior to going public in 2021.

“We look forward to partnering with the Doma team and providing excellent underwriting services to Doma’s many strong agents,” said Scott McCall, president and CEO of TRG.

According to ALTA’s market share data, TRG reported $470 million in title premiums in 2023, while Doma reported $302 million in title premium volume last year. Combined, the two had 4.4% marketshare in 2023.

Doma’s underwriting and technology divisions are expected to be renamed Doma TechCo, which Doma said would continue to have access to underwriting services and continued technology deployment for Doma Title Insurance, Inc.

In January 2019, States Title acquired North American Title Group’s underwriter (North American Title Insurance Co.) and the majority of its retail title business (North American Title Co.) from Lennar. Lennar, through its affiliates, has 25% voting power of Doma's common stock and it has agreed to vote in favor of the deal. After the transaction, Lennar will hold 8.36% of the merged companies.

Last year, Doma sold its West Coast operations to Williston Financial Group.

Under California’s Housing Accountability Act, a provision known as the “Builder’s Remedy” provides that local governments may not deny certain housing projects — in particular, those that include certain thresholds of low- or moderate-income units — for inconsistency with zoning or land use designation. This is a limitation placed on cities and counties to encourage them to act in good faith and follow the state's housing element law. While developers have submitted dozens of builder’s remedy applications in the past year alone, many noncompliant jurisdictions have reportedly not been processing those applications in a timely fashion.

Attorney General Rob Bonta is sponsoring Assembly Bill 1893 (Wicks), to provide more guidance and certainty as to the applicable standards, reducing the prospect of disputes and litigation that impede the development of additional housing. For example, AB 1893 would:

• Designate sites appropriate for residential development, including housing, retail, and office space. Sites that have an existing industrial use or are adjacent to an industrial use would be precluded from the builder’s remedy. Industrial uses can pose environmental threats to housing that is located nearby.
  
  
• Provide clear objective standards, such as upzoning by doubling, or in high resource areas tripling, the density allowed under current zoning. Upzoning is where the amount of development allowed on a parcel of land is increased.
  
  
• Make technical amendments to clarify how the builder’s remedy interacts with other state laws.
  
  
• Incentivize housing construction by making more development projects feasible, and enabling smaller developers to compete. By exempting sites 10 units and fewer from affordability requirements and by reducing the affordability requirement for mixed-income projects from 20% to 10%, many more builder's remedy projects will be financially feasible, including small-scale “missing middle” projects. “Missing middle” projects are relatively small multifamily development projects, like duplexes and townhomes, that are more affordable than similarly located single-family homes, and serve the needs of more diverse households.
  
  
• Allow city planning staff to quickly process builder’s remedy applications, since they will be required to utilize the baseline development standards set forth in the bill. Existing law is less certain.

Innovation Homes, an owner and manager of single-family homes announced that it is under contract to acquire approximately 500 additional newly built homes for approximately $140 million. The homes will be in Charlotte, Jacksonville, and Nashville. The homes are being acquired through three developers and deliveries are expected to begin later this year. Innovation announced that it received deliveries of 648 newly built homes in 2023 and anticipates deliveries of approximately 1,000 new homes from its new production pipeline in 2024.

The sale of homes to REITS and institutional investors has come under fire in California where legislation has been introduced to sharply curtail the practice, such as Assembly Bill 2584 (Lee) and Senate Bill 1212 (Skinner).

• Mortgage Loans Assumable by an Existing Borrower
  Assembly Bill 3100 (Low), would, beginning January 1, 2025, require a conventional home mortgage loan on residential real property with multiple borrowers to be assumable by an existing borrower. Any of the existing borrowers would be entitled to purchase the property interest of another borrower on the loan by assuming the seller’s portion of the mortgage if the assuming borrower qualifies for the underlying loan. The bill requires that an explanation of the loan assumption process be included in the loan documents provided to the borrowers.
  
  
• First Right of Refusal Legislation Pulled by Author
  Assembly Bill 2662 (Mathis) would require a property owner selling agricultural land within an area of cultural and traditionally significant tribal land to first send a notice of first right of refusal for the agricultural land to any California Native American tribe historically affiliated with the land. A California Native American tribe desiring to purchase the agricultural land would have to provide a written notification to the property owner of its interest in purchasing the agricultural land within 30 days after the notice of first right of refusal is provided.
  
  The author pulled the legislation from its first policy hearing in the Assembly Agriculture Committee following opposition from the California Land Title Association, the California Chamber of Commerce, and other organizations. CLTA opposed the legislation over concerns that it would cloud title to real property due to its creation of off-record property rights that could not be readily identified, among other concerns.
  
  The legislation provides that, after a property owner receives a notice of interest from a tribe, the property owner and tribe are required to enter good faith negotiations to determine mutually satisfactory terms of the sale. However, the price would be set at the appraised fair market value of the agricultural land, unless otherwise mutually agreed upon by all parties. The property owner could transfer the agricultural land without regard for these provisions, if the property owner does not receive a notice of interest from a California Native American tribe 30 days after the notice of first right of refusal is provided, or if the terms, besides price, cannot be agreed upon after a good faith negotiation period of not less than 90 days.
  
  
• Mobilehome Solar Restrictions Void Under Senate Bill
  Senate Bill 1190 (Laird) makes void and unenforceable any covenant, condition, or restriction contained in any rental agreement or other instrument affecting the tenancy of a homeowner or resident in a mobilehome park, in a subdivision, cooperative, or condominium for mobilehomes, or in a resident-owned mobilehome park that effectively prohibits or restricts the installation or use of a solar energy system on the mobilehome or the site, lot, or space on which the mobilehome is located.
  
  
• Buyer -Broker Agreements Required Under Pending Legislation
  Assembly Bill 2992 (Nguyen) would require that a buyer’s agent and a buyer execute a buyer-broker agreement as soon as practicable, but no later than the execution of the buyer’s offer to purchase real property. The bill defines a buyer-broker agreement as a written contract between a buyer and a buyer’s agent by which the buyer’s agent has been authorized to provide services for or on behalf of the buyer for which a real estate license is required under the contract.
  
  
• No Denial of Permits for Unpermitted Accessory Dwelling Units
  Assembly Bill 2533 (Carrillo) would prohibit a local agency from denying a permit for an unpermitted accessory dwelling unit or junior accessory dwelling unit that was constructed before January 1, 2020. There is an exception if the local agency makes a finding that correcting the violation is necessary to comply with conditions that would otherwise deem a building substandard. A local agency would be required to inform the public about the provisions prohibiting denial of a permit for an unpermitted accessory dwelling unit or junior accessory dwelling unit that includes a checklist of the conditions that deem a building substandard. Homeowners would have to be informed that, before submitting a permit application, the homeowner may obtain a confidential third-party code inspection from a licensed contractor.
  
  The bill would prohibit a local agency from requiring a homeowner to pay impact fees or connection or capacity charges to obtain a permit if they provide evidence that they meet specified criteria for low- or moderate-income households. Local agencies would be prohibited from penalizing an applicant for having the unpermitted accessory dwelling unit and would require the local agency to approve necessary permits to correct noncompliance with health and safety standards.

California’s budget deficit projections have worsened in recent months, forcing the Governor and Legislature to face some serious decisions on what to chop from the State spending.

The budget hole has increased to $73 billion according to the most recent projection from the Legislative Analyst’s Office, a significant increase above the LAO’s prior estimate had of $58 billion. Governor Newsom has only been projecting a $38 billion deficit. The projected deficit increase is largely driven by a deterioration in tax revenue estimates. The significant deficit is likely to cause the Legislature to take a very skeptical eye toward any bill that contains a considerable fiscal impact.

• Cancelling of Business Entities Authorized for Unlawful Use of Personal Information
  Senate Bill 1168, (Limón) would authorize the Secretary of State to cancel a business entity if there is a court order that personal identifying information has been used unlawfully in a business filing. The bill would also authorize a person who has learned that their personal identifying information has been used unlawfully in a business entity filing to file with the Secretary of State a disclaimer of proper authority that is signed and verified under penalty of perjury, so long as the business entity has not been dissolved or terminated at the time of filing the disclaimer.
  
  Senate Bill 1168 also would authorize the Secretary of State to cancel the filing of business entity documents upon a reasonable belief that the entity was created for specified purposes, including an unlawful, false, or fraudulent purpose, and would require the Secretary of State to mail written notice of the applicability of these provisions to the entity.


• Beneficial Ownership Reporting to Secretary of State Required Under Proposed Legislation
  Senate Bill 1201, (Durazo) would require domestic corporations, limited liability companies and real estate investment trusts to include an existing statement filed with the Secretary of State, the names and complete business or residence addresses of any beneficial owner. Beneficial owners are defined in the legislation.
  
  This bill seems to be a follow-up to the recent requirement that similar information be furnished to the U.S. Financial Crimes Enforcement Network (FinCEN) pursuant to the Corporate Transparency Act.

• Maximum Permitted Corporate Ownership of Housing – Civil Remedies
  Assembly Bill 2584, (Lee) would prohibit a business entity that has an interest in more than 1,000 single-family residential properties from purchasing, acquiring, or otherwise obtaining an interest in another single-family residential property and subsequently leasing the property. The bill would authorize the Attorney General to bring a civil action for a violation of these provisions. As a remedy, the business entity could be required to pay a civil penalty of $100,000 for each violation and be ordered to sell the property to an independent third party within one year of the date that the court enters judgment.


• Limitation on Ag Land Ownership by Hedge Funds – Divestiture Required
  Senate Bill 1153 (Hurtado) would prohibit a hedge fund from purchasing, acquiring, leasing, or holding a controlling interest, as defined, in agricultural land within the State of California. The bill would define a “hedge fund” to mean a privately offered investment vehicle, foreign or domestic, that pools the contributions of private investors to invest in a variety of asset classes, such as securities, futures contracts, options, bonds, currencies, real estate, agricultural land, water, energy, and other resources or commodities. Land held by a hedge fund before the bill’s effective date would be exempt. Land transferred in violation of the provisions would be subject to divestiture.


• Purchase of Housing by Investment Entities Will be Void
  Senate Bill 1212, (Skinner) would, on and after January 1, 2025, prohibit an investment entity, as defined, from purchasing, acquiring, or leasing an interest, as defined, in a single-family dwelling or other dwelling that consists of one or two residential units within this state. The purchase, acquisition, or lease of an interest in housing in violation of this prohibition would be void. The bill defines an “investment entity” as a real estate investment trust or an entity that manages funds pooled from investors and owes a fiduciary duty to those investors. Nonprofit organizations and other entities primarily engaged in the construction or rehabilitation of housing are exempt from the definition of an “investment entity.”

The results of Freddie Mac’s Primary Mortgage Market Survey® (PMMS®), released last Thursday showed the 30-year fixed-rate mortgage (FRM) averaged 6.74 percent. The survey is focused on conventional, conforming, fully amortizing home purchase loans for borrowers who put 20% down and have excellent credit.

“The 30-year fixed-rate mortgage decreased again this week, with declines totaling almost a quarter of a percent in two weeks’ time,” said Sam Khater, Freddie Mac’s Chief Economist. “Despite the recent dip, mortgage rates remain high as the market contends with the pressure of sticky inflation. In this environment, there is a good possibility that rates will stay higher for a longer period of time.”

Rates

• The 30-year FRM averaged 6.74 percent as of March 14, 2024, down from the prior week when it averaged 6.88 percent. A year ago at this time, the 30-year FRM averaged 6.60 percent.


• The 15-year FRM averaged 6.16 percent, down from the prior week when it averaged 6.22 percent. A year ago at this time, the 15-year FRM averaged 5.90 percent.

Ahead of the State of the Union Address, the Biden Administration released a plan aimed at lowering housing costs, which includes a pilot to waive the requirement for lender’s title insurance on certain refinances.

The American Land Title Association issued a statement calling the waiver a hollow attempt by the White House to placate Americans’ current economic frustrations. According to the ALTA, the Administration had not engaged with the ALTA on the issue prior to its announcement.

According to the Federal Housing Finance Agency (FHFA), the pilot program waives the requirement for lender’s title insurance or a legal opinion on certain low-risk refinance transactions where there is confidence that the property is free and clear of any prior lien or encumbrance.

National Beneficial Ownership Reporting Called into Question

FinCEN’s regulations that went into effect on January 1, 2024, require non-exempt entities to report beneficial ownership information. A federal district court has now decided that the Corporate Transparency Act (CTA) is unconstitutional because it exceeded the powers of Congress.

The court decided that the CTA is not authorized under Congress’s foreign affairs powers, or the Commerce Clause of the U.S. Constitution, because FinCEN regulations applied to purely domestic issues and not national issues. The court also decided that the CTA is not authorized under Congress’s taxing powers because though because it might help with tax collection, that fact in and of itself is not a taxing power justification.

The court enjoined the federal government from enforcing the CTA against the plaintiffs who brought the lawsuit. FinCEN will apparently keep its reporting website up and running since it is likely to appeal the decision and request a stay.

Title companies and settlement agents are up in arms over the latest Notice of Proposed Rulemaking from the Financial Crimes Enforcement Network (FinCEN). The proposed rule would impose nationwide reporting obligations on escrow and title companies on “all cash” transactions, transfers to trusts and transfers that involve financing by non-financial institutions – like seller carry-backs or loans from family members. The rules portend a significant burden for reporting entities, as they appear to potentially involve even transfers at no value, such as gifts or transfers to a trust.

FinCEN claims that bad actors use the real estate market to engage in money laundering by buying residential real estate in all cash transactions. FinCEN also claims that it is difficult to figure out who beneficially owns entities or trusts that acquire property for all cash or in transactions financed by non-traditional lenders.

The compliance costs will be tremendous, and FinCEN has offered very little evidence of their value in anti-money laundering (AML) efforts.

ALTA, CLTA, and other land title associations are in the process of reviewing the proposed rule with the intent to provide comments ahead of the April 15th deadline.

The Los Angeles Times reported that Los Angeles County has hired a firm to begin an estimated 7-year plus process to review its real property records, with the goal of identifying and redacting racially restrictive covenants found in those records. Dean Logan, the L.A. County Clerk/Recorder indicated that an estimated 130 million documents will be examined as part of the process. Documents at the county go back to 1850, but only those from the mid-seventies are digitized which allows for an automated search of those records but the remainder will require a more intensive process.

Removing the offensive and illegal restrictions in documents is possible due to a law (Assembly Bill 1466 in 2021) supported by the California Land Title Association. The legislation, which allowed a new document recording fee to fund the program, allows a homeowner to make a request to remove a restrictive covenant that they find on their property.

Though still visible in real property records, the racial restrictions have been unenforceable since the U.S. Supreme Court ruling in 1948 in Shelley v. Kraemer, they were outlawed by Congress in the 1968 Housing Act.

The California Court of Appeal has sided with the California Privacy Protection Agency (CPPA) in deciding that the Agency’s authority to enforce its amended regulations should have been effective on July 1, 2023. The decision reverses a lower court decision, which had delayed the implementation of some of the Agency’s regulations that took effect on March 29, 2023, for one year. The lower court decision had also applied the delay in enforcement to any proposed regulations still being developed by the Agency.

In rendering its decision, the Appellate Court focused on the voters’ intention to strengthen and protect consumers’ privacy rights regarding the collection and use of their personal information.

The California Chamber of Commerce, which brought the lawsuit to delay enforcement, is expected to file a petition for review with the California Supreme Court. The California Privacy Rights Act of 2020 (CPRA) is enforced by the CPPA, but the Agency has sought to implement new and amended regulations which address business compliance as interpreted and required by the Agency.

Michael Macko, Deputy Director of Enforcement for the California Privacy Protection Agency, stated that, “This decision should serve as an important reminder to the regulated community: now would be a good time to review your privacy practices to ensure full compliance with all of our regulations.”

The Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) announced a Notice of Proposed Rulemaking requiring new anti-money laundering reporting requirements for the real-estate industry. Some consider the new rules an incredible overreach that will require extensive use of title and escrow company resources to generate reports for FinCEN. Comments are being accepted for 60 days after publication of the Proposed Rule. If implemented as proposed, the rule stands to be the biggest change to federal law impacting title companies since TRID in 2015, and threatens to place substantial burdens on real estate settlement services providers.

The reporting requirement applies to all non-financed transfers including cash and gifts on “Residential Real Property,” where the transferee is an entity or trust. Under the proposed rule, there must be a “Reporting Person” designated or identified for each transaction. The reporting person is identified based on what FinCEN's proposal describes as a “cascading” approach, starting with the person listed as closing agent on the settlement statement. Or, if that's not applicable, the person who prepared the statement or the person who files the deed. If none of these individuals are identifiable or applicable, then the reporting person is the title company that underwrites the owner’s policy. If there's no owner’s policy, then the reporting person would be the person who distributes the greatest amount of funds, the person who evaluates the status of title, or the person who prepares the deed.

• This is the information that FinCEN is proposing to require for the “Real Estate Report”:


• Name and Address
• Citizenship
• Unique Identifying numbers such at IRS Tax Identification Number (TIN) (e.g., social security number or entity identification number (EIN)).
• Representative capacity of the signing individual
• Information concerning payments requiring specific descriptions of all potential forms of consideration in the transaction for all transferees, including the sources of those payments including specific account information. Included in this category would be specific account information, including monies transferred between buyer and seller but not included in the escrow funds held by the settlement agent.
• Information concerning the residential real property, such as the legal description, including section, lot and block.


• Data collected from the transferee would be based on a certification by the transferee or the representative of the transferee.


• The report would be required to be filed within 30 days of the transaction and a copy of the filing retained for 5 years by the settlement agent or Reporting Person.


• FinCEN cited data suggesting that this reporting will be required of 11.5 -15% of all residential property transactions.

The California Chamber of Commerce reported that the Civil Rights Department has updated its pay data reporting resources for 2024. Pay data reports are due on May 8 but can be submitted now.

Since 2020, California has required employers with at least 100 employees to submit pay data reports to the CRD. There were some major changes to the law taking effect just last year. In addition to reports covering payroll employees, last year’s revisions to the law expanded the reporting requirements to cover “labor contractor employees.” Reporting now also includes whether employees worked remotely. Prior Excel templates cannot be used. Instead, updated versions are required. The Chamber suggests that employers should begin preparing for the new reporting.

Alameda County District Attorney Pamela Price’s Consumer Justice Bureau announced the launch of the ‘Real Estate Fraud Notification Program.’ It is an innovative, proactive, free program to combat real estate fraud and is designed to protect homeowners from potentially fraudulent activity affecting property ownership.

Specifically, when the title of a property is transferred to another person, from the filing of a Grant Deed or Quitclaim Deed at the Alameda County Clerk-Recorder Office, a letter from the District Attorney’s Office is automatically generated and mailed to notify the owner of the transfer. The letter also includes a copy of the first five pages of the document which triggered the notification. Homeowners who are not aware of the transfer are asked to contact the District Attorney Real Estate Fraud Unit to have the matter investigated, prosecuted, and ultimately voided by the Court.

“The goal of this program is to protect the most valuable asset a person in Alameda County can have, and that’s their home. All too often, white-collar thieves target the equity earned by seniors in our community who purchased their homes many years ago,” said District Attorney Pamela Price. “This free program is designed to proactively investigate, prosecute, and void any fraudulent transfer.”

Last month, U.S. Senators Joe Manchin (D-WV) and Tim Scott (R-SC) introduced bipartisan legislation to protect the nation’s state-based insurance regulatory system and ensure the Consumer Financial Protection Bureau (CFPB) does not overstep their statutory authority. Their bill, the Business of Insurance Regulatory Reform Act, would clarify the jurisdiction granted to the CFPB by the Dodd–Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) and affirm that state insurance regulators are best positioned to oversee insurers and safeguard the interests of consumers. The bill is supported by several national insurance trade associations, including the American Land Title Association.

Title X of the Dodd–Frank Wall Street Reform and Consumer Protection Act created the CFPB and granted the Bureau the authority to regulate “financial products or services.” Congress explicitly gave states the regulatory power over the business of insurance through the McCarran-Ferguson Act of 1945, and in Dodd-Frank, excluded the “business of insurance” from the CFPB’s purview such “financial products or services.”

The press release announcing the legislation noted that the CFPB has acted outside the scope of its authority by taking a number of actions against state-regulated insurance entities engaged in the business of insurance. The legislation clarifies that enforcement of the insurance industry remains the power of state regulators, not the CFPB.

The Wall Street Journal (WSJ) recently published an article about Fannie Mae expanding the use of attorney opinion letters (AOLs) for lenders in limited circumstances for loans secured on condo properties and those subject to restrictive agreements or covenants. The CLTA is unaware of AOLs being used in connection with loans on California properties but is closely following this issue. In the case of a residential sale in California, the California Association of Realtors Residential Purchase Agreement (RPA) addresses the issuance of title insurance.

Indeed, an attorney opinion letter may well fall under the definition of title insurance in California. Section 12340.1 of the Insurance Code defines title insurance to include insuring, guaranteeing or indemnifying holders of liens against loss of damage suffered by reason of liens, encumbrances, and defect, as well as the invalidity or unenforceability of any lien or encumbrance. “Holders of liens or encumbrancers” are further defined in Section 12342 to include institutional third parties referenced in federal law, specifically Fannie Mae and Freddie Mac.

The CLTA has previously addressed the threat posed by unregulated, non-insurance products. Over the years these products have included the Radian lien guarantee program and the Norwest TOP program. In that regard, the CLTA continues its long-standing efforts to educate legislators, regulators, and consumers about the critical benefits of title insurance and the risks posed by unregulated title insurance alternatives. State and federal regulators may need to be reminded of the risks posed to financial institutions by these products.

The ALTA has sought to provide reporters and others with the key facts as to the benefits of title insurance. Prior to the publication of the WSJ article, the ALTA had engaged with the WSJ, yet the article neglected many key facts and included several inaccuracies about title insurance. In response, ALTA President Don Kennedy submitted a letter to the editor (LTE) pointing out the important insurance protections provided by title insurance. This is clearly a matter that needs the constant attention of the ALTA and state title associations.

Blackstone Real Estate Partners X together with Blackstone Real Estate Income Trust, Inc. announced that it will acquire all outstanding common shares of Tricon. The deal equates to a $3.5 billion equity transaction value.

In addition to managing a single-family rental housing portfolio, Tricon has a single-family rental development platform in the U.S. with approximately 2,500 houses under development, as well as numerous land development projects that can support the future development of nearly 21,000 single-family homes. The Company also has a Canadian multifamily development platform that is building approximately 5,500 market-rate and affordable multifamily rental apartments.

Under Blackstone’s ownership, the Company plans to complete its $1 billion development pipeline of new single-family rental homes in the U.S. and $2.5 billion of new apartments in Canada (together with its existing joint venture partners). The Company will also continue to enhance the quality of existing single-family homes in the U.S. through an additional $1 billion of planned capital projects over the next several years.

Old Republic Title Co. has acquired the operating assets of Chico, Calif.-based Bidwell Title & Escrow Co.

The acquisition adds four office locations to Old Republic Title’s Northern California Region. Old Republic welcomed the former Bidwell team as part of its existing network of direct operations that includes more than 285 branch and subsidiary office locations nationwide.

Bidwell Title & Escrow traces its history to 1913 when the organization began as Kipp Abstract Co. In 1929, it incorporated into Oroville Title Company and later moved its title department from Oroville to Chico, changing its name to Bidwell Title & Escrow Co. Under the leadership of President Trevor Joyner, Bidwell Title & Escrow offered title and escrow services, handling real estate transactions in Chico, Paradise, Oroville, and Gridley.

“We believe what really distinguishes Bidwell’s Title & Escrow operations is their personalized approach with customers and the long history of title and escrow expertise they have provided in the communities they serve,” said Carolyn Monroe, president and CEO of Old Republic National Title Holding Co. “Trevor Joyner and his team know Butte County real estate well. As a matter of fact, their property ownership records date back to the 1800s. Similar to Old Republic Title, Bidwell has been building relationships in title and real estate for more than a century. The dedicated staff has a reputation for quality escrow work, and a focus on effective communication through each step of the real estate transaction. We believe those priorities align well with our Company’s culture and standards. I am delighted to welcome the team to the Old Republic Title family, expanding their resources through our national network of operations, underwriting expertise, financial strength and technology.”

Joyner, now a senior vice president and Butte County manager at Old Republic Title, added, “Our teams look forward to working as part of Old Republic Title’s Western Title Division, continuing to serve customers from our existing offices. We are in the process of rebranding and changing our name to Old Republic Title.”