When the TRID guidelines took effect in 2015, they included a strange new way to disclose title insurance when there is a simultaneous purchase of lender and owner policies. This transition was a painful process for some and, based on the CFPB’s findings in the Summer 2021 Supervisory Highlights, there are still institutions out there disclosing this incorrectly. The Highlights stated:
Where there is simultaneous purchase of lender and owner title insurance policies, Regulation Z requires creditors to disclose the lender’s title insurance based on the amount of the premium, without any discount that might be available for the simultaneous purchase of an owner’s title insurance policy. Creditors are required to disclose the premium for the owner’s policy showing the impact of the simultaneous purchase discount. The intent of this rule is to provide consumers with information on the incremental additional cost associated with obtaining an owner’s title insurance policy, and the cost they would be required to pay for the lender’s policy if they did not purchase an owner’s policy. Examiners found that some creditors violated Regulation Z by disclosing the lender’s title insurance premium at the discounted rate and the owner’s title insurance at the full premium on the Loan Estimate. Supervision requested that the creditors revise their policies and procedures to ensure correct disclosure of title insurance premiums where there is a simultaneous issuance rate for lender’s and owner’s title policies.
Be sure to JOIN US for our webinar, “Auditing TRID”, where we will look at TRID from an auditor’s perspective. Learn the hot spot areas and other things to look for and ensure your mortgage loan files are compliant.
Diane joined Banker’s Compliance Consulting with over 10 years of compliance experience and over 15 years of experience within the financial industry. Diane is a Certified Regulatory Compliance Manager (CRCM) and has a Bachelor’s Degree in Sociology with a concentration in Criminal Justice. She is a graduate of the Schools of Banking Compliance School and has participated in various other training opportunities throughout her career. Diane understands firsthand the struggles banks face in building and maintaining successful compliance programs. Her experience and common sense approach to consumer compliance is a great asset to our clients.
Diane and her husband have two kids who keep them busy. She enjoys running and other sports and is a big Bugs Bunny fan! She’s a bit crazy in that she does enjoy reading some of these regulations and she’s a “crazy cat lady!” Her cat tales are hilarious!