Whether you are planning to attend or not, there will be several hot topics covered in the sessions, demos, and panel discussions at the National Settlement Serving Summit this year. NS3 2018 will have an agenda focused on State and Federal Regulations, improving relationships and data exchanged between lenders and title agents, and the burgeoning digital reformation of the industry, from eClosings to blockchain.
The Rundown on Regulations
Wednesday sessions will focus heavily on Federal and State Regulations and Enforcement in the title industry.
The Consumer Financial Protection Bureau has been undergoing some changes. The first is a return to its original nomenclature of the Bureau of Consumer Financial Protection by its acting director, Mick Mulvaney. Bigger changes include the overall attitude of the bureau being led by a new director under a new administration. Mulvaney has made a commitment to a new philosophy which will work for everyone involved in the real estate transaction, including the companies it regulates, by ensuring that the businesses affected by the bureau will have full disclosure of all the rules before being fined.
In January, a staff memo by Mulvaney stated: “This means more formal rulemaking on which financial institutions can rely and less regulation by enforcement.”
While things may becoming more relaxed on the federal front, states, like New York, are clamping down on regulations affecting title companies, lenders, and underwriters. The new regulations related to cybersecurity, affiliated arrangements, and title fees will be a focus of the session, The New York Effect. As more states move to passing legislation for the use of digital real estate transaction tools and programs like eNotary and online mortgage origination, more states will expect the Covered Entities regulated by their Department of Financial Services to follow stricter and more comprehensive cybersecurity programs to protect consumer’s sensitive data. The NYDFS Cybersecurity Regulation includes rules shortening the data retention requirements for audit trails from 5 to 3 years and clarification on when a Covered Entity must provide notice of a cybersecurity event to the NYDFS.
Of course, the most contentious changes in regulations by the NYDFS are those that limit ancillary fees that title agents and title insurers charge customers at closing. While consumer advocacy groups argue that these regulations will help trim closing costs by no longer passing off the expense of marketing costs like kickbacks, referral fees, and tips for closers to consumers, the industry sees the long list of prohibited expenditures as a major handicap to doing business.
The finalized regulations were implemented in February of 2018, but the New York title industry is still vigorously lobbying against these changes as they have seen a dramatic impact on business, especially for smaller title companies, leading to about a 10 to 30% decrease in revenues according to Bob Treuber of the New York State Land Title Association.
Traditional strategies work for the title industry, but there may be other ways to attract business. There are other methods to grow your title company under unpredictable state and federal regulations. Effect of Post-PHH Decision on Marketing and Advertising Activities will dive deeper into what kind of RESPA compliance title agents still need to be aware of despite the decision favoring the mortgage company and a more reasonable CFPB (or BCFP?).
Settlement agents will hear more about how the changes in New York will affect them in the future regardless of whether they live or work in the state.
The Regulation Panel on Wednesday will be led by two regulatory experts and two state regulators. They will continue the discussion on how regulatory oversight on the state level is increasing. Life After Enforcement promises to enlighten title agents on how a company can move past an affiliate arrangement mishap and realign with RESPA requirements, reflecting the best interests of consumers. Mark Myers, CEO of Meridian Title will openly talk about how the company has turned their recent RESPA violation and fine into an opportunity for positive change.
If you miss the sessions on Wednesday, Thursday morning’s Keynote Address, Regs, Relationships, and the Right Way, will be delivered by Alessandro DiNello, President and CEO of Flagstar Bank. He will discuss how Flagstar navigated regulatory issues and the financial crisis to become the largest publicly traded bank in Michigan, a leading mortgage lender and a national leader in the wholesale mortgage industry. He’ll also give some insights on why combining quality and profitability leads to success, his opinions on TRID, recent technology and cybersecurity measures.
Improving Lender and Title Agent Relationships
We often hear from our clients about a desire to improve communications with lenders. Loan officers, Mortgage Brokers, Realtors, and Title Agents are all invested in the transaction closing on time. A deal falling through means that many of the professionals involved in that would-be closing will be missing an opportunity for commission. Lenders: Perfecting Closings Together will feature three national lenders discussing how everyone involved in closings can address pain points and form a meaningful collaboration.
The symbiotic relationship between lender and title agents is further reflected in the session, Data is Gold: A Miner’s Guide. Title agents capture vital datasets from consumers that lenders need to meet the new compliance requirements from Fannie Mae and Freddie Mac. This session will teach agents how to comply with the Uniform Closing Dataset (UCD) requirements, how to catch errors in mapping which affect the correct display of fees and how to use the data you’ve captured to improve operations. This is one way that federal regulations are helping to improve data accuracy by creating greater consistency in the collection and language used to describe the information exchange between business partners working on deals involving FHA loans. This information is vital for completing the Closing Disclosure. Dirty or incorrect data will adversely impact everyone involved.
To learn more about the UCD requirements, check out Fannie Mae’s helpful site.
Hot Topics in Title Industry Tech
Many states have adopted legislation allowing some form of eNotarizations in the past couple of years. This trend will only continue as the industry finds ways to appeal to a generation of homebuyers interested in a simplified and secure digital real estate transaction. From Zero to eClosing and a Live eClosing featuring remote online notarization will demonstrate the impact of this new process and technology has on real estate. Title companies who have yet to utilize this revolutionary technology will walk away with actionable knowledge to develop an implementation plan.
The final day starts with thoughts from industry leaders during the Underwriter Panel: Conversations with the C-Suite. They’ll talk about their opinions on blockchain and digital mortgage implementation, compliance with state and federal regulations, and cybersecurity.
After that, Cybersecurity: A Plan for the Attack will educate professionals on how to deal with a cyber attack once it happens. Real life examples from an attorney, lender and the Federal Trade Commissions will be used to demonstrate how to best respond if your company or clients become a target.
Blockchain, Bitcoin and You will teach attendees how blockchain is being used in the transfer of property title records and the financial transactions in a real estate deal.
Through the adaptation to changing regulations and technologies, embracing automation, and working with third-party title support services who are committed to quality, accurate data, transparency, and communication, title companies will be able to improve efficiency, minimize human error, and stay current with state and federal compliance requirements.
Let Loose and Give Back
Other than the informative panel discussions, sessions and demos, title agents and other professionals will have the chance to mingle at the Networking Nightcap on Wednesday and the Networking Reception on Thursday. The Make a Child Smile Event will bring the industry together for a good cause. Attendees will put together Summer Fun Supply Kits for the Boys and Girls Clubs of Southeastern Michigan. One of the best parts of this year’s NS3 is that you can earn up to 17 Continuing Education and Continuing Legal Education credit hours. You can check the list of the 26 states that have approved the courses here. If you haven’t registered for the 2018 NS3 yet, there still time.
We can’t wait to see you there! Check out the full agenda here.