In spite of the worst recession since the Great Depression, a sweeping expansion of federal financial regulation is coming our way.

Earlier this month, I attended the National Association of Independent Land Title Agents (NAILTA – www.nailta.org) conference in Baltimore, Maryland and learned of something that might also concern  every real estate agent and attorney across the United States.  Allow me to briefly summarize the problem and make you aware of coming risks for the real estate community.

Under the guise of Dodd-Frank regulations, a company by the name of Secure Settlements, Inc. (SSI) , and others surely to follow, have created lender agreements with wholesale lenders to begin “vetting” all service providers pursuant to the Consumer Financial Protection Bureau (CFPB) guidance Bulletin 2012-03 which asks lenders to obtain risk compliance from all service providers they do business with.   SSI attempts to charge every service provider employee, real estate agent or lawyer, a fee of $299 per year to be vetted under an unknown and unquantifiable set of standards imposed by SSI in order to do business with certain wholesale lenders.  There are no regulators for SSI.  There is no vetting for SSI.  It’s simply a pay to play system meant to impose standards from outside the legal and real estate community on those who participate in closing loans for banks.  It is completely unnecessary.  Nonetheless, banks are signing onto the program.

Obviously, the title insurance industry is concerned.  NAILTA has provided a white paper on the subject and has shared with the Mortgage Bankers Association, the CFPB, members of Congress and the title insurance industry.

Again, this vetting could be required for all individuals involved in the transaction who will be related to the transaction in anyway.  This also includes the closing agent, notary, real estate agents, attorneys and possibly others.   These lenders attest that if you wish to continue closing transactions with them that you must register with Secure Settlements, Inc., however, in return by complying with this requirement, it meets their obligations under Dodd-Frank/CFPB and applicable FNMA and FHA guidelines to actively manage loan fraud risk.

Subscribe To Our Newsletter

Join our mailing list to receive the latest news and updates from our team.

You have Successfully Subscribed!