October 2009


REGULATORY NEWS

Proposed Rule Hearing Changes Not in Effect Yet

As we reported earlier,Texas Department of Insurance Commissioner Mike Geeslin published a notice of proposed amendments to the Basic Manual as a result of the 2008 Biennial Rule Hearing that was held on October 2, 2008.

TLTA has recently received a number of inquiries regarding the effective date of the proposed changes.Please note the Texas Department of Insurance published these changes with a proposed effective date of October 1, 2009, however until a final order is issued we do not know what the actual effective date will be.

In TLTA's submitted comments,we requested TDI delay the effective date until 60 days after the final adoption to allow everyone time to comply. We anticipate a later effective date will be granted. We will notify you as soon as a final order is issued. Click here to view TLTA's extensive submitted comments, including our objections to some of the proposed items. Click here to view the proposed rules.

Update Your Basic Manual-Ask a Question-Get More Information

TDI Issues Order Correcting Previous Minerals Order

The Texas Department of Insurance has issued an order correcting the previous minerals order (No. 09-0650). The originally published order included a parenthetical reference “(T-1)” in P-50(C),which as drafted would have precluded the ability to use T-1R. It was not the intent of the TLTA proposal to preclude the availability of T-1R. The correcting nunc pro tuncrectifies this technical oversight.
Also, in TLTA's rule hearing comments we officially requested that the stat codes for the new products created by the minerals order be assigned in the final rule hearing adoption order.
As a reminder, the changes outlined in the final minerals order will go into effect November 1, 2009. If you have any questions, please contact TLTA's Director of Government Affairs,Aaron Day, at 512.472.6593.

View Nunc Pro Tunc Order
View Amended Item
View Original Minerals Order and Adopted Items(Before Change)

Recommended Education on Minerals Changes-Update Your Basic Manual-Get More Information

Biennial Rate Hearing Update

After three full days, the Biennial Rate Hearing came to a close on September 16. The Industry put on a strong case supported by testimony from economists, actuaries and TLTA member witnesses. All of the witnesses' pre-filed testimony may be accessed on TLTA's website, along with the pre-filed testimony of other parties to the hearing. TLTA will post the hearing transcript on our website once it has been made available and we encourage you to review the information currently available.

At the conclusion of the hearing, the administrative law judges announced the final brief submission deadlines and indicated their goal is to have their recommendation to the TDI Commissioner before the end of the year.

TLTA will continue to keep you updated on this important process and if you have any questions or comments please contact TLTA at tlta@tlta.comor 512.472.6593.

FEDERAL NEWS

Contact Your Congressman Today to Voice Opposition to the Federal Regulation of Title Insurance Through CFPA

The House Financial Services Committee, chaired by Barney Frank, held its first hearing last month on the Consumer Financial Protection Agency (CFPA) bill (H.R.3126). Another round of hearings is expected before the final mark up of the bill. So far, title insurance is included in this bill and is defined as a financial service. If the bill passes as drafted, then all aspects of the business of Texas title agents and underwriters will be directly regulated by the federal government in the same manner that TDI regulates the industry today. Additionally, a direct tax can be assessed against every entity or person regulated by this new agency, creating a new financial burden on your company.

Contact Your Congressman
It is very important that you contact your Congressperson and Senator relative to this effort to directly regulate your business at the federal level. Not only is federal regulation a potential increase in the cost of running your business, it further removes your ability to be part of the regulatory process. It poses a serious threat to the way you currently do business in Texas and upends our long and successful history of the state regulation of title insurance.
Below are some helpful talking points which you can use as a reference or as a communication piece when talking with your elected official or their staff.Time is of the essence and we appreciate your participation.

Talking Points

Title insurance is already regulated at the state level. In Texas, a comprehensive regulatory framework is in place to address protection of consumers and the health of the industry. Title insurance rates are set by the Insurance Commissioner through a public hearing process. Consumers have ample opportunity to be a part of the rate setting process.
Other insurance products, like life insurance and property and casualty are not part of this proposal.
Removing us from the definition does not mean looser federal regulation. RESPA and Disclosure requirements represent sufficient federal oversight.
It is important to remove us from the definition so we are not federally regulated as individuals.
Follow These Steps for Effective Advocacy
1. Check here to find out who represents you in Congress.

2. Review the above talking points.

3. Contact Aaron Day if you have any questions about your message.

4. Make the call: Call your Congressional Representative at 202-225-3121 and ask to speak to the"Legislative Assistant handling financial services matters".

5. Complete the TLTA Grassroots Contact Report.

American Land Title Association President Testifies Before Congress on Impact of First-Time Buyer's Credit and Creation of CFPA

The extension and expansion of the $8,000 first-time homebuyer tax credit would greatly stimulate the housing market and propel the country onto further recovery, while the creation of a Consumer Finance Protection Agency (CFPA) would impose many unintended consequences on small businesses including title agencies and escrow operations, American Land Title Association President Mike Pryor told members of Congress today.

ALTA is in support of making the current tax credit, which expires after Nov. 30, available to all homebuyers, without restrictions on income or their status as a first-time homebuyer because it will continue to bring consumers back to the market, reduce inventories of unsold homes and stabilize home prices.

“Last year, Congress provided much needed assistance to the real estate economy with the passage of the First Time Homebuyer Tax Credit,” Pryor said during a hearing for the House Small Business Committee. “I would be reluctant to declare its effect a boom, but I can tell you that without that action, many in our industry would have closed their doors. Unfortunately, the threat of closure still exists. Unless Congress acts quickly, it will be a very long winter for many of us.”

Without the tax credit stimulus, the summer season, which is typically the real estate’s strongest period, would have been dismal. “The lack of summer reserves, coupled with exhausted or unavailable credit has left too many of our members struggling for their economic lives,” Pryor said.

View ALTA's full press release.

National Association of Insurance Commissioners (NAIC)Seek Industry Data

The National Association of Insurance Commissioners(NAIC) held its fall meeting late last month and passed a “State Page” reporting requirement for underwriters. The first reporting information will be due in 2010, followed by a more detailed breakout of policies issued by states on a residential and non-residential basis beginning in 2012.
This State Page is a part of a larger effort by the NAIC, specifically the NAIC Title Working Group, to gather data on prices and profits in the industry nationwide and has resulted in several data calls by insurance departments around the country. The American Land Title Association (ALTA) recently provided a list of data calls, statistical plans, and requests for information which have been received so far this year from state insurance departments. It is important to note that while this increased activity does not directly affect members of the Texas title industry yet, it is important that we continue to monitor these efforts and represent you and your concerns.
TLTA will continue to work closely with ALTA in offering guidance to NAIC as they continue to request and collect this data. If you have any questions, please contact Aaron Day at 512.472.6593.

NAIC Testifies Before House Financial Services Committee

On Tuesday, the National Association of Insurance Commissioners (NAIC) testified before the House Financial Services Committee stating its support of the concept of increasing knowledge and access to information on insurance at the federal level. They cautioned that a proposed federal insurance office should most appropriately be a tool to connect the state regulatory system with the federal regulatory system, and not be an instrument to displace or diminish state insurance regulation.View NAIC's full press release.

RESPA Reform Guidance Update

The Department of Housing and Urban Development released the latest installment of FAQson October 7. These FAQs attempt to answer some of the Title Industry's questions regarding compliance and implementation of the pending rules, which are set to take effect on January 1, 2010.
There have been numerous attempts by various stakeholders to obtain a six month delay in the implementation of the new RESPA rules, however at this time there is no indication that a delay will be granted. TLTA has sent the Texas Department of Insurance (TDI) a list of observations and suggestions relative to the potential conflicts between TDI requirements for the HUD-1 and the new RESPA rules.
In the meantime, we strongly encourage you and your staff to prepare for the pending rules. TLTA has several RESPA-focused education on demand programs and our special three city seminar RESPA Live: Words Worth Hearing wrapped up yesterday in Arlington. We'll be back on the road again in November and December withRESPA and the New HUD-1: Hands-on How-to Workshop.*Check out the education calendar to find the workshop nearest you and stay tuned for registration details.
*Please note workshop participants are expected to already have at least an introductory understanding of the new RESPA rules and HUD-1.
Recommended Education on RESPA-Ask A Question-Get More Information

TEXAS LEGISLATIVE NEWS

Dewhurst Appoints Sunset Commission Members

Earlier this week, Lt. Governor David Dewhurst appointed his selections to the Sunset Advisory Commission. The Commission is made up of five Senators, five Representatives and two public members.

Dewhurst appointed Senator Glenn Hegar to serve as Chairman of the Sunset Advisory Commission for the 82nd Legislature. Senator Hegar and his staff were very helpful during the negotiation of the Sunset Bill during the 81st session and has been open to hearing and understanding the perspective of title industry and our particular concerns. Other members appointed to the Commission include Juan "Chuy" Hinojosa, John Whitmire, Robert Nichols and Joan Huffman. Dewhurst also named Charles McMahen of Schulenberg as his public appointee.

The Legislature approved the continuation of the Texas Department of Insurance and the Office of Public Insurance Counsel during July's special session. Both state agencies will be reviewed by the Sunset Advisory Commission during the interim and we look forward to working with these newly appointed members.

TLTAPAC

Why I Give

Earlier this summer, TLTA President Mark Greek outlined his goals for the association in the coming year. One of those goals was to raise $100,000 for the TLTAPAC. As of September 30 we’ve raised an outstanding$28,525, but we’re just getting started and we need your help. Some of you might be asking yourself why should I give? Here's Why...

Ladies and Gentlemen, Step Right Up...

The Annual TLTAbay Online Auction is returning November 5-12, 2009 and we need your help! Thanks to our participants last year, we were able to raise almost$14,000 for the TLTAPAC. The money we raise goes directly toward protecting our industry. Your contribution helps us effectively educate elected officials and communicate the importance of Title Insurance in Texas. Our annual online auctions is a "fun way to give" and we'recounting on your support.

Donating is as Easy as 1-2-3!

1.Goods- Donate a new or unused items to the online auction. Or purchase an item online and donate it directly to the TLTAPAC.

2.Money- Can't secure an item for the auction? Send TLTA a personal or corporate monetary donation and we'll do the shopping for you.Download a Donation Form.

3.Time- Solicit places you do business with, such as your local florist or restaurants, to donate an item or gift certificate.

View a list of suggested donation items

NEWS TO KNOW

Industry Makes Case for Home Buyer Tax-Credit Extension

Wall Street Journal| Oct 7 2009
A slate of representatives from sectors that thrive on the construction, sale and upkeep of homes made a strong pitch for extending the $8,000 first-time home buyer tax credit in a U.S. House hearing Wednesday.

The home builder, realtor, construction, title insurance and architecture industries argued that the credit has helped to stabilize the housing market and also boost the broader economy. Some of the groups are pushing to increase the size of the credit and expand it beyond first-timers.View full story.

Industry Stats

Release Date Latest Release
Change from Previous Release

30 Year Fixed Mortgage Rates 10/01/09 4.94% -0.10%
15 Year Fixed Mortgage Rates 10/01/09 4.36% -0.10
10 Year Treasury Rate 10/01/09 3.21% -0.10
Existing Home Sales (in millions) 9/24/09 5.10 -2.7%
New Home Sales 09/25/09 429,000 +0.7%
Supply of Housing Inventory 09/25/09 7.3 months -2.7%
Information Provided by ALTA.

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