ALTA Board Approves Revised CPLs, Decertifies ALTA Endorsement 2-06

November 12, 2015

During its Oct. 8 meeting, the ALTA Board of Governors approved two revised closing protection letters (CPLs), decertified ALTA Endorsement 2-06 (Truth in Lending). The board also approved a joint survey standard developed with the National Society of Professional Surveyors (NSPS), which is the successor to the American Congress on Surveying and Mapping (ACSM). All of these documents may be downloaded from www.alta.org/forms. The comment period for the revised CPLs is open until Nov. 27.

ALTA Closing Protection Letter – Single Transaction

ALTA Closing Protection Letter – Multiple Transactions

The landscape for residential real estate loan transactions has changed with the adoption of the Dodd-Frank Act and other federal and state laws, the TILA-RESPA Integrated Disclosure Rule, and the required Closing Disclosure. As previously stated by ALTA, “The closing process will significantly change when the Consumer Financial Protection Bureau's final rule for integrated mortgage disclosures goes into effect. The rule integrates forms required under the Truth-in-Lending Act (TILA) and Real Estate Settlement and Procedures Act (RESPA). A Loan Estimate will replace the current Good Faith Estimate and early TIL disclosure, while a Closing Disclosure will replace the HUD-1 and final TIL disclosure.” With the implementation of the new Closing Disclosure under the TILA-RESPA Integrated Disclosure Rule, it is necessary to revise the ALTA Closing Protection Letter – Single Transaction (04-02-14) and the ALTA Closing Protection Letter – Multiple Transactions (04-02-14) to conform to changes in the law and to modify existing language in the closing protection letters for consistency and clarity. Those changes include:

  • A new heading of “Requirements” for the introductory section
  • Clarification that the assignee of the Insured Mortgage must be an assignee for value with Knowledge
  • Clarification that the coverage relating to defects, liens, encumbrances or other matters in connection with the transaction is provided to the extent afforded in the Policy
  • Consistent with the 2011 and earlier CPLs, recognition that there is no obligation to determine the validity, enforceability, or effectiveness of a document, except to the extent the policy coverage applies
  • Recognition that the exclusions for particular laws includes the failure of the Issuing Agent or Approved Attorney to comply with closing instructions relating to those laws
  • As provided in prior letters, acknowledgment that the Company is liable only to the holder of the Indebtedness at the time payment is made.
  • Cooperation requirements applicable to the Addressee.
  • Recital that the letter may not be modified by the Issuing Agent or Approved Attorney.

ALTA Endorsement 2-06 Truth in Lending

The ALTA Endorsement 2-06 Truth in Lending is decertified effective 12-01-2015. The form is no longer in demand as an industry standard. The form may continue to be used in the marketplace, but will not be a part of the ALTA Policy Forms collection.

Minimum Standard Detail Requirements for ALTA/NSPS Land Title Surveys

The Boards of ALTA and NSPS approved revisions to the Minimum Standard Detail Requirements for ALTA/NSPS Land Title Surveys. The standard is the results of significant work and cross-industry partnership between land title professionals and surveyors. The revised standard will become effective Feb. 23, 2016.

Questions?

If you have questions/concerns or need more information about the Forms, contact Kelly Romeo, the staff liaison for the ALTA Forms Committee and Liaison Committee with the NSPS, at kromeo@alta.org or 202-261-2948.


Contact ALTA at 202-296-3671 or communications@alta.org.

29638