CFPB Webinar Addresses Title Disclosures

April 18, 2016

The calculation of the owner's title policy premium (in a purchase transaction when owner's and lender's policies are issued simultaneously) in accordance with the rule might result in a negative number. Does the creditor disclose this negative number for the owner's title policy on the Loan Estimate and Closing Disclosure?

 

Dania Ayoubi, counsel in the CFPB's Office of Regulations, said that in this situation, the creditor would disclose the premium for the owner's policy as a negative number. "When a simultaneous issue rate or discount is used--mostly in purchase transactions--the cost of an owner's title insurance policy is disclosed as the incremental cost of that owner's title insurance beyond the standard non-discounted cost of the lender's title insurance policy," Ayoubi said. "When disclosed in this fashion, the disclosure conveys to the consumer that it is less expensive to purchase both owner's title insurance and lender's title insurance together than it is to purchase just lender's policy by itself."

 

Click here to access the entire presentation from the April 12 webinar. The CFPB staff reminded listeners that the webinar is not a substitute for the rule. Only the rule, including its amendments and official commentary, can provide complete and definitive information regarding the Rule's requirements.


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