NEW YORK STATE DEPARTMENT OF FINANCIAL SERVICES
FOR IMMEDIATE RELEASE, FEBRUARY 8, 2018
CONTACT: Richard Loconte 212-709-1690, public-affairs@dfs.ny.gov
 

Statement by DFS Superintendent Maria T. Vullo Regarding the Payment of Title Closers

DFS has heard reports of title insurance companies and title insurance agents hiring closers and failing to pay them for the services they perform to ensure clean title.  These services are critical to the title insurer who is guaranteeing clean title.  Any defect in title arising from a mistake at the closing could result in a claim under the title insurance policy.  DFS regulations require the title insurer or agent that hires a title closer to pay the closer.  Closers are entitled to be paid fairly in accordance with their services.  Where there is advance notice to the seller of real estate, an independent closer may also be able to charge a pick up fee, but that does not excuse the title insurer or agent that hired them from fairly compensating them for their services for the buyer.  Fair compensation for all work done to effect the transfer of clean title should be paid for by the title insurance company or agent as that is covered by the premium.  Any closer who is not paid as DFS regulations require can file a consumer complaint with DFS.  DFS will investigate any allegation that a licensee is failing to follow any rule, or otherwise cheating title closers or any other persons. 

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Friends:

I have been watching this email chain grow.  There have certainly been some useful insights.  With new people paying attention, some for the first time, there has also been a lot of “rediscovery” of things others have looked at before.  Some of the commentary has been uncomfortable to see, knowing DFS, companies & NYSLTA are seeing it.  However, I think it has provided a representation of the state of closers as we approach next month.  Anxiety.  Frustration.  Fear.

We can all agree, we are facing difficult and challenging times.  DFS has precipitated a looming disaster and we have all been left to try and survive it.  Companies and closers, alike.   If there is any chance for ALL of us to weather this storm it will require ALL of us to bring to bear our very best efforts and ideas.   NYSLTA, underwriters, company owners and their employees, as well as closers are all facing this challenge.  Our problems are different and there are no ideal solutions arising that will fully satisfy everyone.  This regrettable fact has fed anxiety, eroded trust and hampered our universal need to find workable solutions.   There will be a title insurance industry after December 18.   We need to keep that in mind as we all aspire to remain part of it.  We must find ways to work together.

I have spoken to most of the companies for which I close.   This is an existential threat to small companies and the industry is struggling to find workable solutions under the regulations as they are now written.   I get no sense the companies I have spoken to have any interest in preventing closers from being able to make a living.  Many companies are trying to figure out how they will survive, themselves.   This is why I have been exploring solutions that would allow companies and closers to survive.

Until we are presented by companies with the policies and procedures they intend to proceed under beginning December 18, I believe it is premature to consider drastic action.   There are likely to be companies that, after sincere and difficult effort will present policies and procedures under which I (or we) may choose to close under.  I do not think it is prudent or responsible (to ourselves, those who depend upon us financially or to the industry in which we participate) to forego exploring any and all solutions to this crisis before undertaking a refusal to work.   The consequences of such an action are numerous and serious.   I have not seen any thoughtful discussion of these consequences and I believe such a discussion would be necessary before such action is undertaken.   I think our industry deserves that.

I am glad to see numerous closers have chosen to join NYSLTA.   As I have said before, our best opportunities to help shape industry policies that affect closers is to have a seat at the table.  However, if we wish to participate we must do so responsibly.   We must do our best to understand those issues which concern us, so as to make substantive contributions to the process of addressing them.  We must expect that of ourselves if we wish to be taken seriously addressing the issues we take seriously.   There are advantages to being members of NYSLTA.  Those who choose not to join NYSLTA choose not to afford themselves of them.   Those of us who join have undertaken a duty to participate responsibly.

I too, have chosen to contribute to the NYSLTA legal defense fund.  I have no reservations that the Association action will benefit closers.   I recognize we are not the only people adversely affected by the regulations and the ensuing action will challenge the regulations on numerous fronts and in a variety of ways.   I want to do my part.   I hope more closers join us.

These are my personal opinions.  I offer them as my contribution to the discussion.  I do so after serious reflection.   I intend to continue to work toward solutions that will allow us all to continue to make a living in this industry because I expect we will find ourselves operating under these frightful regulations come December 18.   I endeavor to make every word and effort count.  

Respectfully,

Jim Hunter

Independent Title Closer

Member, NYSLTA