the florida legal eagle - volume 3
DESCRIPTION
An Underwriting Newsletter by First American TitleTRANSCRIPT
An Underwriting Newsletter by First American Title
GET TO KNOW
KEN MACKAYSVP, SOUTHEAST REGION
FINCENGEOGRAPHIC TARGETING ORDER
CLOSING CORNER
ARE YOU A MASTER OF TRID
FIRPTATOP TEN QUESTIONS
IS SOMEONE PRETENDING TO BE YOU?
Volume IIIFebruary/March 2016
www.firstam.com
©2016 First American Financial Corporation and/or its affiliates. All rights reserved. NYSE: FAF
The information contained in this document was prepared by First American Title Insurance Company (“FATICO”) for informational purposes only and does not constitute legal advice. FATICO is not a law firm and this information is not intended to be legal advice. Readers should not act upon this without seeking advice from professional advisers. First American Title Insurance Company makes no express or implied warranty respecting the information presented and assumes no responsibility for errors or omissions. First American, the eagle logo, First American Title, and firstam.com are registered trademarks or trademarks of First American Financial Corporation and/or its affiliates.
First American Title | The Florida Legal Eagle2233 Lee Road, Suite 202, Winter Park, FL 32789407.691.5295
EXECUTIVE EDITORS: Len PrescottAlan McCallTrish LadanChip Koval
EDITORS: JoJo GroveAdrianna La Kam
As the new year has been taking shape, our Florida Underwriting Team has been probing the many industry and business changes, challenges, and huge opportunities that we will face with you in 2016. The changes and challenges illustrated in the newsletter pages are many and can easily seem overwhelming: FIRPTA, FinCEN, necessary Mastery and Myth Busters of TRID, Reminder to Read All Closing Instructions and Is Someone is Pretending to Be You? These topics just scratch the surface.
And yet, taking this inventory into the new year has us as passionate and inspired as ever! We are privileged to work with some of the smartest people in the world, to deal with complicated challenges, and to help our terrific agents and employees solve problems. Our Executive Spotlight features Ken MacKay SVP, Southeast Region Manager, who reminds us that success in any size business requires the ability to enjoy being a problem-solver and constantly working to make the customer experience better. Ken knows our business and our people, and we are proud to work with a business leader who has this perspective.
It is not just that we love our work and solving problems, we love the people we work with and the clients we serve. Thank you for inspiring us!
All the Best,
FROM THE EDITOR’S DESK
PAGE TITLE
3 Executive Spotlight: Ken MacKay
4 Coffee and Espresso with the Underwriter Webinar Schedule
5 The Property Professor
6 FinCEN: Geographic Targeting Orders
7 Underwriting Q&A: Liens Arising from Criminal Activity
10 Closing Corner: Are you a Master of TRID?
11 TRID Myth Busters: What You Need to Know
13 Top 10 Questions about FIRPTA
16 Title Agents Reminded to Read All Lender Closing Instructions
17 Underwriting Spotlight: Pat Newton
18 Rapid Response Team
19Is Someone Pretending to be You and Communicating with Your Customers?
20 Case Law Updates / Legal and Industry Updates
21 South Florida Underwriting Team
IN THIS ISSUE:
We Want Your Insight!Your insight is valued by the Florida Underwriting Team! If you would like to contribute to the Florida Underwriting Newsletter, or if you have any comments or suggestions for topics that you would like to see in our newsletter, please submit your ideas to JoJo Grove, Underwriting Associate, at [email protected]. We look forward to your input!
Len PrescottVP, Florida State Counsel
Ken MacKaySVP, SOUTHEAST REGION
Executive Spotlight Executive Spotlight
Q WHAT WAS YOUR FIRST JOB IN THE TITLE INSURANCE INDUSTRY?
A My first job was as a runner in a title agency in Ocala at age 15. I primarily delivered Abstracts of Title to law firms in the area, on a bicycle. Later, I had my first full-time role with the same company as a title searcher.
Q WHAT WERE THE STEPS THAT LED YOU TO YOUR CURRENT ROLE?
A After serving as a title searcher for two years, I left the agency and obtained a Master’s in Business Administration from the University of Florida. My only time away from the industry was a 3-year stint working for a major homebuilder in the Orlando market. While there, I received a call from the owner of an Ocala title agency letting me know he intended to sell his company. He invited me to make an offer, and after I successfully purchased the company, he stayed on for about five years. I will forever be indebted to him for his loyalty while I learned, through much trial and error, to manage the company that had been his for the previous 40 years.
Q DO YOU HAVE ANY HOBBIES OR OUTSIDE INTERESTS?
A I love to fly general aviation aircraft and love anything related to water, especially scuba diving. I also have a farm where I grow citrus and raise cattle.
Q WHAT ARE THE MAJOR DIFFERENCES YOU SEE BETWEEN RUNNING A SMALL BUSINESS AND MANAGING A REGION FOR FIRST AMERICAN TITLE?
A There are advantages to both. In a small business, you are the primary decision-maker and can move very quickly to solve customer issues and make asset purchases. As a result, there is a lot of satisfaction in solving customers’ problems. As a manager for First American Title, I spend more time bringing people together toward consensus-oriented decisions, and in solving employees’ issues so that they can solve customers’ problems. The common denominator is enjoying being a problem-solver, and constantly working to make the customer experience better. Every day is different because each day’s challenges involve a different set of people, all of whom are very different. The key is having the patience to see individuals as being unique and enjoying seeing them approach challenges differently. Everyone brings value, and it’s my job to help unlock their potential to do that.
Q WHAT ARE YOUR OVERALL GOALS FOR THE FLORIDA UNDERWRITING TEAM IN 2016?
A My goals are to 1) challenge us to set the bar another notch higher for 2016. It’s hard to measure “good service”, but hopefully, we grow our ability to answer phone and email inquiries on the same day the request arrives and acknowledge the inquiry within an hour of its arrival; 2) personally support the Underwriting team by making sure I understand the day-to- day challenges of the job; and 3) do a much better job of communicating “the whys” behind the changes we make at a managerial level.
don’t forget to change your clocksTick-tock, tick-tock
A friendly reminder to set your clocks ahead by one hour.
MARCH 13th
Page 3First American Title | Florida Legal Eagle | Volume III, February/March 2016
&Espressowith the Underwriter | 2016 WEBINAR SERIES
Available Now:DRILLING DOWN THE UNDERWRITING ON FLORIDA OIL, GAS & MINERAL RIGHTSCLE Credit availableLen Prescott, VP, Florida State Counsel» Access recording at: https://attendee.gotowebinar.com/
register/1456725734752619522
FIRPTA - IMPORTANT CHANGES FOR 2016Wade Wallace, Underwriting Counsel» Access recording at: https://attendee.gotowebinar.com/
register/4278747672611558401
FinCEN – GEOGRAPHIC TARGETING ORDER FOR MIAMI-DADE, COUNTY AND COMPLIANCELen Prescott, VP, Florida State Counsel» Access recording at: https://attendee.gotowebinar.com/
recording/7643452265775496961
Upcoming Webinars:UNDERWRITING COMMUNICATIONS – A REVIEW OF RECENT HOT TOPICS Wednesday, March 9th | 9:30am – 10:30am
Trish Ladan, Senior Underwriting Counsel Florida Associate State Counsel
EASEMENTS-INSURING AND EXCEPTINGCLE Credit availableWednesday, April 13th | 9:30am – 10:30am
Jennifer Bloodworth, Senior Underwriting Counsel
THE VALUE OF OWNER’S TITLE INSURANCEWednesday, May 11th | 9:30am – 10:30am
Barbara Burke, Ph.D., Esquire, Legal Education Specialist
NOTARIES, ACKNOWLEDGMENTS AND JURATS Wednesday, June 8th | 9:30am – 10:30am
Alan McCall, VP, Southeast Region Underwriting Counsel
BANKRUPTCYCLE Credit availableWednesday, July 13th | 9:30am – 10:30am
Pat Newton, Senior Underwriting Counsel
MOBILE HOMESWednesday, August 10th | 9:30am – 10:30am
Greg Blomeley, Underwriter
Save the Date! for these informative webinars. Following the webinar, a recording will be available. Links to the presentations will be provided at a later date. Invitation and registration information coming soon!
Page 4First American Title | Florida Legal Eagle | Volume III, February/March 2016
Dear Property Professor,
I have a strange one that I bet you have never heard before.
A bank is requiring three mortgages on three different properties from three different borrowers to secure a business loan of $1 million. If that isn’t wild enough, the bank wants each mortgage to be for the full amount of the loan. The borrower is a friend of my sister who needs business cash. So, he will give a $1 million mortgage on his horse farm, one of his companies will give a $1 million mortgage on a glue factory and another company he owns will give a $1 million mortgage on an abattoir. Hey, that’s $3 million worth of mortgages for the same $1 million loan! Sounds like they’re just horsing around (sorry, couldn’t resist). The guy from the bank said that they want to “tie the policies together” with a tie-in endorsement. Is that so they don’t get loose? Seriously, I didn’t know you could do that.
Here’s the part I don’t get: Won’t this cost three times the premium?
Thanks,– Kemo Sabe in Kissimmee
PS: I hope I’m right about the premium, as we are having a slow month.
Dear Kemo,
Thanks for your question. This situation is not as uncommon as you might think.
The ALTA 12 or tie-in endorsement is meant to be used where the policy amounts are different because the bank allows an allocation of security interest in each mortgage or will take a mortgage in a different secured amount for each property. Where each mortgage secures the same debt of the same borrower, then each policy can be ‘tied together’ and premium paid as if one policy was being issued in the total amount. Thus, the customer saves a few dollars of premium because we do not have to charge separately for each policy. By the way, this is only allowed for loan policies, never for owner’s policies.
But, your case is different because each of the policies is being issued for the full amount of the loan, i.e. $1 million. Since the bank can never suffer a loss greater than $1 million (plus possible interest and expenses added to the coverage in the policies), the $3 million in total policies is overkill. So, instead of “tying them in,” we need to “pry them apart.” Instead of adding them together, we need exceptions in each policy limiting the amount of coverage overall to just $1 million. After all, the lender could never suffer a loss greater than the amount of its loan anyway. The solution is to use an exception in each policy that reduces the combined liability to just $1 million. Further, the exception should also provide that any claim paid under one policy reduces the liability pro tanto under all of the policies. For instance, if the insurer pays $200,000.00 for a covered title defect under Policy A, then coverage under Policy A, plus Policy B plus Policy C is reduced to $800,000. It is easy to see why we call this the “pro tanto” exception (not to be confused with the Lone Ranger’s famous sidekick, Tonto, played by Johnny Depp in the recent movie).
Your local underwriter can provide further details and discuss the applicable premium charge in your case.
Thanks Kemo Sabe, and Happy Trails! – Property Professor
PS: Pro Tanto is Latin. I think it means “slow month to continue”, but I’m not real sure. I don’t speak Latin. You could Google it!
By: Alan McCallVP, Southeast Region Underwriting Counsel, Daytona Beach, FL
THE PROPERTY PROFESSOR
Page 5First American Title | Florida Legal Eagle | Volume III, February/March 2016
On January 28, 2016, we sent you a Memorandum regarding the issuance of Geographic Targeting Orders (“Orders”) by the Financial Crimes Enforcement Network (“FinCEN”) to selected “Covered Business” entities that include First American Financial Corporation and any of its subsidiaries and title agencies.
VIEW MEMORANDUM AND ORDERS:• Memorandum• Real Estate GTO Order Final - 1.13.16 - Manhattan - First American Financial• Real Estate GTO Order Final - 1.13.16 - Miami-Dade - First American Financial
As stated at that time, First American has reviewed the Orders and is providing you at this time with the following:
NEW YORK:• Underwriting Communication-NA-2016-003• Exhibit A Copy of Order• Exhibit B Questionnaire• Exhibit C Instructions to complete Form 8300• Exhibit D ALTA FAQ• Exhibit E FinCEN FAQ
MIAMI-DADE:• Underwriting Communication-NA-2016-004• Exhibit A Copy of Order• Exhibit B Questionnaire• Exhibit C Instructions to complete Form 8300• Exhibit D ALTA FAQ• Exhibit E FinCEN FAQ
Please refer to the Underwriting Standard for requirements for compliance with the Orders imposing the reporting requirements that begin on March 1, 2016.
First American, along with other affected title insurers and the American Land Title Association, is in communication with FinCEN representatives to continue to clarify the requirements for compliance with the Orders.
In order to provide additional guidance, First American Title held live webinars on Tuesday, February 16th, and Thursday, February 18th. You may access a recording of our most recent webinar here.
As your underwriter, it is important to us that you receive these valuable tools and guidance to comply with the Orders. Keeping our agents up to date with important information is a priority and one more reason to do business with First American Title.
Please contact Len Prescott, 305.908.6252, or your local underwriter if you have any questions.
Thank you for your consideration and commitment.
FinCEN Geographic Targeting OrdersBy: John T. LaJoie, Senior Operations Counsel – Agency Operations | Len Prescott, VP, Florida State Counsel
Page 6First American Title | Florida Legal Eagle | Volume III, February/March 2016
Q HOW DOES RESTITUTION ORDERED AS A RESULT OF CRIMINAL CONDUCT AFFECT REAL PROPERTY OWNED BY THE CONVICTED OFFENDER?
A The court that convicted the offender can enter a restitution order in favor of the crime victims, the state or its local subdivisions, and other injured parties. § 775.089, Fla. Stat. Restitution orders attach as a lien on real property owned by the convicted offender in each county in which the restitution order is recorded. The recorded copy of the restitution order does not need to be certified to be enforceable against real property. The resulting liens are enforceable in the same manner as judgments in a civil action. Satisfaction of these liens should be executed by the party directed by the court to collect and disburse the restitution payments. If the court’s order does not designate such a party, then the victim stated in the order can execute a satisfaction of the lien. In addition to restitution payable under the cited provisions of Ch. 775, Fla. Stat., a convicted offender is also subject to civil liability for damages under § 960.294, et. seq., Fla. Stat. Civil restitution lien orders may be imposed under those statutes to compensate the crime victim and also to compensate the state and its local subdivisions for the cost of incarceration and related corrections costs. The lienholder may enforce a civil restitution lien in the same manner as a judgment in a civil action, and when properly recorded becomes a lien on the convicted offender’s real property. § 960.294(2) Fla. Stat. The recorded copy of the order does not need to be certified to result in an enforceable lien. It is noteworthy that civil restitution liens continue for a period of 20 years after their date of entry. Satisfaction of these liens should be executed by the lienholder.
Q HOW DO PUBLIC DEFENDER LIENS AFFECT REAL PROPERTY INTERESTS?
A A lien can be created upon the real property of any person who has received assistance from a public defender, special assistant public defender, from any office of criminal conflict and civil regional counsel, or from any private conflict attorney. § 938.29(2), Fla. Stat. The recorded judgment, which does not have to be certified, creates a lien for the amount of unpaid attorney’s fees in favor of the State upon the real property of the named party and is enforceable by the State for the same time period as judgments as set forth in § 55.10, Fla. Stat. For assistance provided to a minor, the lien attaches to the property of the minor’s parents, and the lien continues despite the minor becoming emancipated or reaching the age of majority. The clerk of the circuit court for the county where the defendant was tried, or the county in which the defendant received the services of a public defender, has the power to satisfy or release the lien. See § 938.29, Fla. Stat.
Underwriting Q&A
Liens Arising From Criminal ActivityBy: JoJo GroveAssociate Underwriter, Gainesville, FL
Access Behind Bars: Criminal Liens and Costs chart here.
LIENS ARISING FROM CRIMINAL ACTIVITY
BEHIND BARS: CRIMINAL LIENS AND COSTS
©2016 First American Financial Corporation and/or its affiliates. All rights reserved. NYSE: FAF
www.firstam.com
The information contained in this document was prepared by First American Title Insurance Company (“FATICO”) for informational purposes only and does not constitute legal advice. FATICO
is not a law firm and this information is not intended to be legal advice. Readers should not act upon this without seeking advice from professional advisers. First American Title Insurance Company makes no express or implied warranty respecting the information presented and assumes no responsibility for errors or omissions. First American, the
eagle logo, First American Title, and firstam.com are registered trademarks or trademarks of First American Financial Corporation and/or its affiliates.AMD: 02/2016
LIEN TYPE IMMEDIATE LIEN UPON RECORDING?
SUPPLEMENTARY PROCEEDINGS REQUIRED FOR LIEN? SEE, §938.30, F.S.
CERTIFIED COPY NEEDED?
ENFORCED AGAINST HOMESTEAD?
LIEN ATTACHES TO ALL REAL PROPERTY OWNED BY DEFENDANT, SAME AS UNDER §55.10, F.S.
DURATION
Public Defender: §938.29(2), F.S. (including indigent application cost/fee) See §27.52, F.S.
Yes No No No Yes, but if defendant is a minor, then attaches to parents’ property.
20 years 2
Court Imposed Financial Obligations§§938.30(6), (8) and 939.185(1)(d), F.S.
Yes Yes No No Yes 20 years 2
Restitution Liens:(1) §775.089, F.S. (Criminal)(2) §960.294, F.S. (Civil)
Yes No No 1 No Yes (1) Criminal: 20 years.2
(2) Civil: 20 years, §960.294(4), F.S.Special County Cost
Assessments§939.185(d), F.S.
Yes No Yes No Yes 20 years 2
Florida RICO Act (Racketeer Influenced and Corrupt Organization), §895.03, F.S.
Yes. Filing of notice creates lien.
No No No. See, Butterworth v. Caggiano, 605 So.2d 56 (FL 1992).
Yes. Lien on real property AND any beneficial interest in real property.
6 years from date of filing, but may be extended for additional 6 years. §895.08(1), F.S.Federal Restitution
18 U.S.C. §3613Yes. Arises upon entry of judgment. Notice of lien typically filed, rather than judgment.
No No Yes. Same as Federal Tax Lien.
Yes. Lien in favor of U.S. on all property AND rights to property of fined person. NOTE: Attaches to entireties property, same as Federal Tax Liens.
Lien does not expire. 3
1 No. RE: Civil: BUT pursuant to §960.292(3), F.S., civil restitution liens MUST contain: the name of the convicted offender, the case number, and the names and social security numbers of the crime victim, state, its local subdivisions, or aggrieved parties, as appropriate. Therefore, a civil restitution lien under Chapter 960 is invalid if it does NOT identify the person or entity in whose favor it was imposed.
2 Similar to civil judgments pursuant to §55.10, F.S., EXCEPT not subject to the 10 year re-recording requirement of §55.10.3 Lien does not expire until either: (A) 20 years from date of criminal’s release from prison (Termination by release from prison must be established by recorded proof of release); or (B) if no prison term (probation only), 20 years from date judgment; or (C) upon the death of the person fined. Death of criminal prior to expiration of lien period terminates lien provided death is evidenced by recorded Death Certificate. NOTE: 1-year right of redemption if foreclosed by judicial sale.
Page 7First American Title | Florida Legal Eagle | Volume III, February/March 2016
Master of TRID is not a degree or a designation, but it is the stage every industry expert seems to be striving to reach a few months into the Rule implementation. How did we get here and what were the stages?
LEARNED IT Everyone had to learn about software and integration, the most important parts of the 1888-page Rule, the timelines and the new forms, the responsibilities of each party, and how to quote premiums.
LIVED IT October 2015 rolled around and we all had to live it. There was plenty of confusion, lots of clarification, and many experienced a slight paralysis in the normal flow of business operations. After many delayed closings, these transactions are now part of our daily regimen and are the new normal.
SHARING ITEveryone lived it and survived, but every person who was involved in a TRID transaction has an experience to share.
MASTERING ITAs industry experts, it is our mission to master TRID transactions as efficiently, effectively, and as quickly as the Rule allows. Here are a few tips that might help you expedite gaining expertise in the art of becoming a Master of TRID:
A) Pick up the phone. Limit email contact and instead, have phone conversations with the loan officer, the loan processor, and the loan closer. Ask questions such as; Are any delays expected? Are these firm dates for consummation? You can usually get a feeling from a phone call whether things are realistically on track. To go one step further, confirm the content of your phone conversations with a follow-up email.
B) Ask for closing instructions in advance. The instructions might not contain final numbers. However,
with a trend of lenders modifying their closing instructions to contain language that shifts delivery and compliance responsibility to the closing/settlement agent, it is ideal to have the instructions as far in advance as possible. It never hurts to ask, and it might prevent a delay.
C) Five days prior to closing. Provide a draft CD to the lender with all figures including HOA prorations, taxes, and any other figures you have available. Make a phone call to the lender and request a copy of their final CD. You may discover that the closing has been moved or perhaps learn of an issue. If you receive the CD before the customer, you may be able to make needed corrections and
avoid customer confusion.
We hope these tips will help you on your road to becoming a Master of TRID. Feel free to email your tips to
[email protected]. They may be included in future editions of the newsletter. The more knowledge we share,
the sooner we will become Masters of TRID.
Are you a Master of TRID?
Closing Corner:
By: Stefanie LollisEscrow Branch Manager, Winter Park, FL
Page 8First American Title | Florida Legal Eagle | Volume III, February/March 2016
TRID MYTH BUSTERS
The implementation of the CFPB’s Know Before You Owe regulation has brought up a number of questions regarding who is permitted to receive copies of closing documents, including the Closing Disclosure and alternate settlement statements, such as the ALTA Settlement Statements. It is important to note that the Know Before You Owe regulation did not implement any changes on data privacy; however, ALTA encourages title insurance and settlement companies to take this opportunity to review your company’s privacy policies to ensure they match your data-sharing practices.
REFRESHER ON GOVERNING LAW
The Gramm-Leach-Bliley Act (GLBA) was passed in 1999 and remains the predominant authority on how to protect data. GLBA requires financial institutions, including title insurance companies and agents, to disclose their data-sharing practices to their customers and to safeguard private and sensitive customer information. To meet these new requirements, GLBA imposed three basic obligations:
1. a privacy notice requirement
2. a requirement that all consumers be provided the opportunity to opt-out of certain information disclosures
3. a requirement that measures be instituted to maintain the “security and integrity” of all nonpublic information.
The GLBA tasked the Federal Trade Commission (FTC) and other government agencies that regulate financial institutions to implement regulations to carry out the Act’s financial privacy provisions. The CFPB is not included in the list of government agencies that regulate data privacy, and thus the implementation of the Know Before You Owe regulation did not affect the longstanding data-security requirements that title insurance companies and agents have been subject to.
With the implementation of GLBA, the FTC released guidance regarding the type of information companies should be safeguarding. The FTC is responsible for enforcing its Privacy of Consumer Financial Information Rule, which protects a consumer’s “nonpublic personal information” (NPI). NPI is any “personally identifiable financial information” that a financial institution collects about an individual in connection with providing a financial product or service, unless that information is otherwise “publicly available”. The Privacy Rule applies to ALTA members that provide real estate settlement services.
ALTA members should note that the FTC considers NPI to be any information obtained about an individual from a transaction involving a company’s services. This could include a person’s name, address, income, Social Security number or other information on an application. This also includes any information from court records or from a consumer report. The FTC said NPI does not include information that is believed to be lawfully made “publicly available.” In other words, information is not NPI when steps have been taken to determine: (1) that the information is generally made lawfully available to the public; and (2) that the individual can direct that it not be made public and has not done so.
APPLYING STANDARDS TO TODAY’S REAL ESTATE TRANSACTIONS
The implementation of the CFPB’s Know Before You Owe regulation has required lenders, real estate settlement agents, and title insurance professionals to radically change the way they conduct business. The new regulation’s disclosure requirements have also generated a greater need to use additional settlement statements, such as ALTA’s model Settlement Statements, to ensure that settlement agents can continue to meet their state disclosure requirements. With the use of these new forms comes the question, “Who is allowed to receive a copy of the Closing Disclosure and settlement statement?” The basic answer is that the Know Before You Owe regulation does not address who may or may not receive a copy of closing documents. Many lenders, however, are refusing to share a copy of the Closing Disclosure with real estate agents or other third parties. Additionally, some lenders are including provisions within their closing instructions that prohibit settlement agents from sharing the Closing Disclosure with third parties. These lenders are stating that the consumer may provide a copy of Closing Disclosure to real estate agents if he or she chooses.
What You Need to Know When Sharing Closing Documents
Page 9First American Title | Florida Legal Eagle | Volume III, February/March 2016
A concern remains about how to get necessary information about the transaction to outside parties, including real estate agents, who need certain information to document their involvement in the transaction. One of the primary reasons real estate agents are interested in receiving the Closing Disclosure is because they have to report certain data fields to MLS to close the listing. These requirements vary by state, and there is not a uniform set of data fields that will satisfy MLS. Reporting these data fields is a requirement for participating in the MLS system, so it is crucial that real estate agents receive this information.
WHAT NOW?
Settlement agents and title insurance professionals should contemplate the requirements and limitations of their privacy policies and contemplate whether any of these policies need to be revisited. The GLBA continues to set a strong standard for protecting NPI, despite going into effect 16 years ago. The ALTA Title Insurance and Settlement Company Best Practices reiterate the importance of privacy policies and include guidelines for companies to protect against data theft to help meet GLBA requirements. Pillar 3 of the ALTA Best Practices provides procedures on physical and network security of NPI, how to properly dispose of NPI, developing a disaster management plan, employee training to ensure compliance, and oversight of service providers.
When revisiting your privacy policies, consider the following questions:
1. Why did you initially implement this policy?
2. What was your rationale in implementing this policy?
3. Does that rational still apply?
4. Does this policy continue to provide adequate protection to sensitive data in today’s marketplace?
5. What information do you need to share with your real estate partners?
6. How are you sharing this information?
After re-examining your privacy policies, you should compare these policies with your company’s data-sharing practices to ensure that you are only sharing information in conformity with your policies.
If your lender prohibits you from sharing the Closing Disclosure with third parties, you may consider using an alternative settlement statement, such as ALTA’s Settlement Statements, to document the transaction. The ALTA Settlement Statements were designed to be model forms based on the settlement statements that have been in use prior to the implementation of Know Before You Owe. These statements may be modified as appropriate to reflect the terms of the transaction and to prevent any disclosure of the buyer’s or seller’s NPI. Four versions of the ALTA Settlement Statement are available: the buyer statement, the seller statement, the combined statement, and a statement for cash transactions.
Lastly, if you plan on sharing a closing document, such as a settlement statement, to a third party, consider whether you are sharing any information that would be considered NPI under the FTC’s guidelines and whether you have met the GLBA’s requirements for sharing such data. Also consider why you feel the need to share this information and how you would anticipate your customer would feel about you sharing that information. By keeping GLBA requirements and ALTA Best Practices in mind as you adapt to the Know Before You Owe regulation, you can ensure that your customer remains protected and that you continue to have compliant real estate closings.
Myth BustersWhat You Need to Know When Sharing Closing DocumentsTRID
COMMON “SETTLEMENT” DOCUMENTS CONTAINING NPI
Uniform Residential Loan Application (Form 1003) (NPI includes: SSN, bank account numbers, loan numbers, work addresses, etc.)
Borrower Tax Returns (NPI includes: SSN, financial information, address)
Lender Engagement Letter (NPI includes: SSN, address, loan numbers)
Identification (Driver’s License, passport, etc.) (NPI includes: address, birth date, ID number, Passport number)
Closing Disclosure, HUD-1, Company or ALTA Settlement Statement (NPI includes: loan number, address)
IRS Form 4506-T, Request for Transcript of Tax Returns (NPI includes: SSN, address)
IRS Form W-9, Request for Taxpayer Identification Number and Certification (NPI includes: SSN, address)
Payoff Letter (NPI includes: Bank account numbers, loan number, address)
COMMON “TITLE” DOCUMENTS CONTAINING NPI
Identification (Driver’s License, passport, etc.) (NPI includes: address, birth date, ID number, Passport number)
Title Order Form (NPI includes: SSN, address, loan number)
Payoff Letter (NPI includes: Bank account numbers, loan number, address
Escrow Agreements with Tax Searches(NPI includes: SSN, address)
Real Estate Transfer Tax Forms (NPI includes: SSN, financial information)
Affidavits (NPI includes: SSN, address)
Recordable Docs (NPI includes: loan numbers, address)
Title Bill (NPI includes: address)
Reprinted with permission of the American Land Title Association. Copyright © 2004-2016 American Land Title Association. All rights reserved.
See more at: http://blog.alta.org/2015/12/trid-myth-busters-what-you-need-to-know-when-sharing-closing-documents.html#sthash.RflXhnTJ.dpuf
Page 10First American Title | Florida Legal Eagle | Volume III, February/March 2016
TOP TEN QUESTIONS ABOUT
FIRPTABy: Jennifer Bloodworth, Senior Underwriting Counsel | Wade Wallace, Underwriting Counsel
1. WHAT IS FIRPTA?
United States tax law requires that all persons, whether foreign or domestic, pay income tax on the disposition of U.S. real property interests. Domestic persons or entities typically are subject to this tax as part of their regular income tax; however, the U.S. needed a way to collect taxes from foreign persons on the sale of U.S. real property interests. The Foreign Investor in Real Property Act (“FIRPTA”) was enacted to provide such a mechanism and requires that a buyer withhold and remit to the IRS a certain percentage of the sales price in anticipation of the taxes that will be due from the foreign seller on such transaction.i FIRPTA applies in nearly all transactions, residential and commercial, in which a foreign owner of a U.S. real property interest sells such interest. The amount withheld is not the tax itself, but is payment on account of the taxes that ultimately will be due from the seller.
2. WHAT ARE THE WITHHOLDING REQUIREMENTS?
Unless an exemption or reduced rate applies, FIRPTA requires that the buyer withhold fifteen percent (15%) of the sales price in all transactions in which the seller of a U.S. real property interest is a “Foreign Person.”
3. WHO IS A “FOREIGN PERSON”?
FIRPTA defines a “Foreign Person” by defining who is not a Foreign Person, so it is important to understand the following definitions:
a. A “Foreign Person” is defined as any person other than a “United States Person.”
b. A “United States Person” is any of the following: (i) a U.S. Citizen; (ii) a resident alien who has a Green Card; (iii) a resident alien who meets the Substantial Presence Test; (iv) a domestic (U.S.) corporation, partnership or other legal entity (except a “Disregarded Entity” as defined by IRS Regulations), trustee or other fiduciary; (v) a Disregarded Entity, the owner of which qualifies as a “United States Person” under (i), (ii), (iii), or (iv), above; or (vi) a foreign entity which has elected to be treated as a domestic corporation (as evidenced by
acknowledgement copy of election furnished by IRS).
c. The Substantial Presence Test: Under FIRPTA, a Foreign Person is considered a U.S. Person for the calendar year of sale if they are present in the United States for at least:
i. 31 days during year of sale ANDii. 183 days during the 3 year period that includes year
of sale and the 2 years preceding year of sale, but only counting:a. All days during year of sale;b. 1/3rd of the days during the first preceding year;
and c. 1/6th of days during the second preceding year.
When counting days, you may not include the days that a Foreign Person is present in the U.S. as a representative of a foreign government (e.g. foreign diplomat), as a teacher or student under a “J”, “Q”, “F” or “M” Visa, or as a professional athlete in a charitable sports event.
d. A “Disregarded Entity” is any single-owner domestic business entity (such as a single-member limited liability company) other than a corporation, unless it has elected to be treated as a domestic association for tax purposes.
4. WHAT IF THE SELLER IS A DOMESTIC LLC?
Single-Member LLC: A single-member domestic limited liability company, while a recognized legal entity, is considered a “Disregarded Entity” for tax purposes. Accordingly, if the seller is a single-member limited liability company, then you have to look to the identity of the sole member of the limited liability company. If the sole member is a “Foreign Person,” then the FIRPTA withholding rules apply in the same manner as if the foreign sole member was the seller.
Multi-Member LLC: A domestic limited liability company with more than one owner is not considered a “Disregarded Entity” and is taxed differently than single-member limited liability companies. Accordingly, the FIRPTA rules regarding withholding do not apply to multi-member domestic limited liability companies.
Page 11First American Title | Florida Legal Eagle | Volume III, February/March 2016
TOP TEN Questions About FIRPTA
5. WHAT ARE SOME EXCEPTIONS TO THE WITHHOLDING REQUIREMENTS?
While there are several exceptions to FIRPTA withholding requirements that eliminate or reduce the required withholding, the most common exceptions are discussed below.
a. Seller not a “Foreign Person.” One of the most common and clear exceptions under FIRPTA is when the seller is not a Foreign Person. In this case, the seller must provide the buyer with an affidavit that certifies the seller is not a Foreign Person and provides the seller’s name, U.S. social security number or taxpayer identification number (“TIN”), and address.
b. Personal Residence Exemption. Under the Personal Residence Exemption, no withholding is due when (1) the buyer is acquiring property that will be used as the buyer’s residence, (2) the sales price is $300,000 or less, and (3) the buyer elects to waive withholding. See additional requirements set forth, below, under “Reduced Rate of Withholding.”
c. Reduced Rate of Withholding: This new exception, which goes into February 16, 2016, is similar to the Personal Residence Exemption, but provides for a reduced rate instead of a full exemption.ii Under this exception, a reduced withholding equal to ten percent (10%) of the sales price is due when (1) the buyer is acquiring property that will be used as the buyer’s residence, (2) the sales price is more than $300,000 but not more than $1,000,000, and (3) the buyer elects to waive withholding. In order to qualify for, either, the Personal Residence Exemption or the Reduced Rate of Withholding, the buyer or a member of the buyer’s family must have definite plans to reside at the property for at least 50% of the number of days the property is occupied by any person during each of the two 12-month periods following the date of closing. If the buyer fails to meet the occupancy requirements, the buyer may become liable to the IRS for the difference between the amount that was actually withheld, if any, and the amount that should have been withheld, plus interest and penalties. Under this exception, the buyer is not required to make this election, even if the facts may support the exemption or reduced rate and the settlement agent should advise the buyer that, neither, the exemption nor the reduced rate automatically applies. Instead, if the buyer opts to invoke the exemption or the reduced rate, the buyer must make an affirmative election to do so. This election should be in the form of an affidavit from the buyer setting forth the buyer’s decision and, if applicable, the facts that entitle the buyer to the exemption or reduced rate.
d. Seller Obtains Withholding Certificate. In some cases, the seller has applied for and received a withholding certificate from the IRS that reduces or eliminates the withholding requirement. A buyer relying on this exception must obtain a copy of the Withholding Certificate and retain a copy in buyer’s records for five (5) years.
e. Foreign Corporation or Single-Member LLC has “checked the box.” There is an exception for foreign corporations or single-member limited liability companies that are subject to FIRPTA withholding that have “checked the box” on the applicable IRS form to be taxed as a domestic corporation. Domestic corporations are not subject to the withholding rules under FIRPTA, so withholding will not be required in cases where entities otherwise subject to withholding have elected to be taxed as a domestic corporation. Importantly, to take advantage of this exemption from withholding, the entity must file Form 8832 with the IRS, obtain IRS approval, and provide evidence of this status to the buyer. The buyer will need to retain a copy of this approval in buyer’s records for five (5) years.
6. ARE TINS REQUIRED FOR ALL PARTIES?
IRS regulations require all buyers and foreign sellers of U.S. real property interests to provide their TINs, names, and addresses on withholding tax returns, applications for withholding certificates, notice of non-recognition, and other related IRS documents when disposing of a U.S. real property interest. While it is best practice to have the TINs for all parties at the time of closing, it is possible to close without the TINs under the following guidelines:
1. If the buyer does not have a TIN, the buyer must remit the proper withholding forms within 20 days after closing; however, the buyer will also need to remit, to a separate address in a separate package, a properly completed application (Form W-7) for a TIN simultaneously with remitting the withholding forms. Please refer to the instructions for each form for further instructions and mailing addresses.
2. If the seller does not have a TIN, the buyer must remit the proper withholding forms within 20 days after closing, but the seller’s TIN information will be left blank. While the TIN is not necessary for closing, it should be noted that the seller will have to obtain a TIN in order for the IRS to process the funds and, in fact, upon receipt of the withholding documentation, the IRS will follow up with the seller instructing the seller to apply for a TIN. For this reason, many settlement agents provide the friendly advice that the seller submit its separate application for a TIN by the time of closing.
Page 12First American Title | Florida Legal Eagle | Volume III, February/March 2016
TOP TEN Questions About FIRPTA
Additional information can be found in the IRS publication entitled “ITIN Guidance for Foreign Property Buyers/Sellers,” which is available at www.irs.gov.
7. WHAT IF THIS IS A SHORT SALE OR THERE ARE OTHERWISE INSUFFICIENT PROCEEDS FOR WITHHOLDING?
There are times, such as short sales, when the proceeds from the sale are insufficient for withholding under FIRPTA. However, FIRPTA withholding requirements are based on the sales price, not the seller’s proceeds, so there is no automatic exemption for transactions in which the seller is receiving zero or insufficient proceeds. In these cases, the seller will need to apply for an exemption or reduced withholding from the IRS. As with applying for a TIN, this process can take some time, so it is imperative that the settlement agent raise these issues with the foreign seller as early as possible in the process.
8. WHAT IF LESS THAN ALL SELLERS ARE “FOREIGN PERSONS”?
The analysis of whether the buyer must withhold funds under FIRPTA must be undertaken with respect to each seller separately, even if the seller is a married couple. Generally, withholding is required for each Foreign Person based on such person’s percentage of ownership. For example, if there are four joint owners, each owning a 25% interest, and one of the sellers is a Foreign Person, then the buyer is required to withhold only 25% of the required withholding. If the seller owns the real property interest as a married couple, the IRS deems each spouse to own 50%. In this case, if only one spouse is a Foreign Person, then withholding only as to such spouse’s one-half interest is required.
9. WHO IS RESPONSIBLE FOR COMPLYING WITH FIRPTA?
While the seller is the party subjected to the tax, it is up to the buyer to withhold the appropriate percentage of the sales price when purchasing U.S. real property from a “Foreign Person.” In the event the buyer does not properly withhold, the buyer may be liable to the IRS in an amount equal to the amount of taxes that should have been withheld, plus interest and penalties.
While the buyer has the ultimate liability to the IRS, the collection and disbursement of funds to the IRS as part of the closing process creates a responsibility and potential liability for the settlement agent if the matter is not properly handled and documented. Accordingly, it is important that your file reflect specific written direction from the buyer if anything other than fifteen 15% is being withheld. For example, if a buyer elects to waive the withholding or withhold a reduced rate, settlement agents should obtain an affidavit from the buyer setting forth the buyer’s decision and, if applicable, the facts that entitle the buyer to the exemption or reduced rate along with an acknowledgement that the buyer has been given the opportunity to obtain independent tax or legal advice.
10. HOW IS THE WITHHOLDING SUBMITTED AND REPORTED?
Generally, the funds withheld must be forwarded, together with IRS Forms 8288 and 8288-A, to the IRS within 20 days after the closing date. However, if an application for a withholding certificate is submitted to the IRS before the date of a sale and the application is still pending with the IRS on the closing date, the correct withholding tax must be withheld, but does not have to be reported and paid immediately. The amount withheld (or lesser amount as determined by the IRS) must be reported and paid within 20 days following the day on which a copy of the withholding certificate or notice of denial is mailed by the IRS.
MORE QUESTIONS?
If you have any further questions about FIRPTA withholding, please feel free to contact a First American underwriter; however, please understand that First American cannot provide legal advice to any party regarding FIRPTA. This article is intended as informational only and should any party need legal advice, the settlement agent should advise such party to engage legal counsel.
i FIRPTA uses the phrase “amount realized,” which typically is the sales price; however, if you or any of the parties involved have any questions, the buyer should consult with legal counsel of buyer’s choosing to ensure that the proper figure is being used when calculating the withholding amount.
ii This amount recently was increased from 10%. According to the strict reading of the effective date for recent amendments to FIRPTA, the fifteen percent (15%) withholding applies to transactions in which the closing, or disposition of real property, occurs on or after February 17, 2016; however, it has come
to our attention that the IRS may be interpreting the language to mean that February 16, 2016, is the effective date. While this is ultimately up to the buyer to decide, we recommend using the date that the IRS will be using.
Page 13First American Title | Florida Legal Eagle | Volume III, February/March 2016
Title Agents Reminded to Read All
Lender Closing Instructions
With lenders responsible for production and delivery of the Closing Disclosure under the TILA-RESPA Integrated Disclosures (TRID) rule, many lenders are modifying their closing instructions and shifting liability onto settlement and closing agents.
Because of this, ALTA reminds members to read all lender closing instructions carefully. Some lenders are modifying instructions to hold settlement agents liable for violations of any laws at the federal, state or local level. As an example, Columbia Bank in Maryland specifically says:
As a settlement officer, you are the Lender’s Agent for the purpose of assuring that there has been compliance with conditions and requirements of Regulation Z, TILA, RESPA, and all state and local laws of the appropriate jurisdiction.
Additionally, below is an example of changes New American Funding made to its closing instructions due to the changes in responsibilities. The changes are bolded.
Settlement Agent acknowledges this transaction is subject to the Truth-In-Lending Act and Regulation Z, 12 CFR §§ 1026.19(e), 1026.38, and that Creditor is responsible for the borrower’s Closing Disclosure and Settlement Agent is responsible for the Seller’s Closing Disclosure. By communicating Settlement Agent’s fees for services to Creditor and undertaking to close the transaction more particularly described within these instructions, Settlement Agent affirms that it has read, understands and agrees to strictly comply with and satisfy all conditions of these Creditor’s Instructions to Settlement Agent, including all exhibits, addenda and attachments (together the “Closing Instructions”). Settlement Agent understands that Creditor sells loans in the secondary market and Settlement Agent agrees that all of Creditor’s rights and privileges under these Closing Instructions inure to the benefit of Creditor’s successors and assigns. Settlement Agent agrees to be bound by these Closing Instructions in all manner of its performance conducted prior to, during,
and subsequent to consummation of the specific transaction(s) covered by these Closing Instructions. Creditor, or Creditor’s successors or assigns, will hold Settlement Agent liable for any losses resulting from Settlement Agent’s failure to follow these Closing Instructions.
Settlement Agent shall immediately indemnify the Creditor, its officers, directors, employees, successors, or assigns (together the “Indemnified Parties”) and hold the Indemnified Parties harmless from and against all claims, demands, liabilities, losses, costs and damages (including court costs and attorneys’ fees) that Indemnified Parties may incur or suffer as a result of damages arising under or related to these Closing Instructions and caused by the actions or inactions of the Settlement Agent or its employees that constitute a breach of these Closing Instructions or negligent or willful misconduct.’
Failure of the Settlement Agent to abide by the Closing Instructions will cause New American Funding to put the company on its watch list or remove the company from an approved vendor status.
Settlement agents will also find guidance to handle updates to the Closing Disclosure in the closing instructions. Generally, when a disclosure becomes inaccurate within three days before consummation and a new three day period is not required, TRID requires the lender to correct the disclosure and ensure the consumers receives the disclosure at or before closing (12 CFR 1026.19(f)(2)(i)). Each lender will have different requirements for how they will want to correct disclosures, the timing for sending them to consumers and the documentation they will require for compliance purposes.
Also in the closing instructions, many lenders are requiring some form of documentation that proves a settlement agent complies with ALTA’s Best Practices. ALTA members are encouraged to be ready to provide this information.
Reprinted with permission of the American Land Title Association. Copyright © 2004-2016 American Land Title Association. All rights reserved.
Page 14First American Title | Florida Legal Eagle | Volume III, February/March 2016
Q IN WHAT AREA OF LAW DID YOU PRACTICE PRIOR TO COMING TO FIRST AMERICAN TITLE?
A Prior to joining First American Title, I specialized, as certified by the Florida Bar, in the practice of Real Estate Law, including matters involving condominium and homeowner associations, residential and commercial lending, closings, construction liens and title insurance.
Q WHAT MADE YOU WANT TO WORK IN THE TITLE INSURANCE INDUSTRY?
A I enjoyed the various aspects involved in the determination of insuring title encountered as a title agent for several major underwriters and enjoyed working with the people in the industry.
Q WHAT BROUGHT YOU TO FIRST AMERICAN TITLE?
A Of the several underwriters with whom I worked, I felt that First American Title was the company I most respected based upon the knowledge and integrity of its individuals.
Q TELL US ABOUT THE EMPLOYEE CULTURE IN THE NAPLES OFFICE.
A The Naples office is comprised of very professional, experienced and pleasant First American Title employees. Their responsibilities include several aspects of the title insurance industry including underwriting, marketing, closing and national commercial services.
Underwriting Spotlight:
Pat NewtonUnderwriting Counsel, Naples, FL
Pat Newton grew up in Michigan. He spent summers at his grandparents’ lakefront property, which naturally established his interests in fishing, ice skating, and hockey. Pat attended law school in Detroit and worked in private practice before joining the First American Title team in 1997 as Underwriting Counsel in our Naples, Florida office. Pat brings over 30 years of industry experience to his role as Senior Underwriting Counsel. In addition to his daily underwriting duties, Pat is the Florida underwriting subject matter expert in the areas of Bankruptcy, Probate and Trusts, Foreign Investment in Real Property Tax Act (“FIRPTA”) and Water Rights.
Pat and his wife, Christine, are both cruise enthusiasts and have taken about sixty cruises over the past thirty years. They enjoy cruising the Mediterranean, due to its beauty and fascinating history, and have traveled to Egypt, Italy, Israel, Turkey and the Greek Islands. Pat often jokes that he “works to cruise.”
Page 15First American Title | Florida Legal Eagle | Volume III, February/March 2016
The Florida Underwriting Department of First American Title is pleased to announce the formation of our Rapid Response Team. We understand that time is of the essence when working on real estate transactions, and a quick response from our underwriting department may be necessary to keep transactions on track, even when the need arises after normal business hours.
The Rapid Response Team shares one email address ([email protected]) and phone number (866.728.5207). Utilizing this communication method will save agents time and eliminate the need to make multiple telephone calls or send multiple emails if their preferred underwriter is unavailable.
The quality and responsiveness of the Rapid Response Team will increase our speed of service and allow us to provide timely underwriting support and assistance to our loyal and valued agents.
RAPID RESPONSE TEAM
FIRST AMERICAN TITLE
Team Members
GREG BLOMELEYVP, UnderwriterWinter Park, FL
BILL BOYCEUnderwriting CounselTampa Bay, FL
CHIP KOVALUnderwriting CounselGainesville, FL
WADE WALLACEUnderwriting CounselEstero, FL
866.728.5207
Page 16First American Title | Florida Legal Eagle | Volume III, February/March 2016
Is Someone Pretending To Be You and Communicating With Your Customers?By: Michele GreenSVP, Senior Business Counsel-Agency Division
We have received numerous reports from agents around the country about fraudsters impersonating our agents and attempting to steal money from unsuspecting consumers and lenders. Although you have been hearing from us on
these issues for over a year now, please realize that the threats have not lessened and are not going away.
Just in the last couple of weeks:
• An agent called their local First American Title office and reported, “I have a closing coming up and, like I always do, I have communicated with my client via email about how they are to provide required funds for closing. After exchanging emails, it was decided that they would bring a cashier's check to closing. Unbeknownst to me, my clients subsequently received another email that LOOKED like an email from my office – it even had my letterhead! The email instructed my clients to wire the funds for closing to a new account and provided wire instructions. Just by chance, my clients were confused about how to complete the wire, and called my office to ask about it. Thank goodness! We quickly figured out that a fraud was being attempted and caught it before any of my clients’ funds were lost.”
• Another First American Title agent called her local office in a complete panic – She received a call on a Monday from the bank that holds her escrow account letting her know that it was overdrawn. The last week had been a busy one, but the agent was sure that all had gone smoothly. After going over her account records, she realized that one of the lender funding wires from one of the closings conducted last week never made it into her account. When she contacted her lender client, she was told the lender had received “her” email notifying the lender of a change in wire instructions for her escrow account. She hadn’t sent any such email, and in the flurry of closings during a busy week, she hadn’t verified the receipt of each and every wire, especially since this lender had emailed her indicating that the wire had been sent.
In both cases, cyber criminals hacked into an email account of one of the parties to the transaction and monitored email traffic about the closing. At the right time, the fraudsters created “spoof” emails that appeared to be from the agent, and had communicated with clients and customers in order to misdirect closing funds. How can you protect yourself and your clients? One way that we know can help:
– CONSIDER HOW YOU PROVIDE YOUR WIRING INSTRUCTIONS TO YOUR CLIENTS AND CUSTOMERS! –
Across the country, many of our agents have decided to provide wire instructions via hard copy only – and with a notation on that hard copy that states essentially “If you receive an email or any other communication that appears to be from my office and that contains new, revised or altered bank wire instructions, consider it suspect and call our office at a number you trust. It is extremely unlikely that our bank wire instructions will change.” No matter how you get the message across to your clients, let them understand that if anyone tells them how or where to send their money, those instructions need to be confirmed by a phone call to your known phone number – NOT by email.
Page 17First American Title | Florida Legal Eagle | Volume III, February/March 2016
Mortgage foreclosure Jurisdiction – Void judgment – Final foreclosure judgment of state court is void where, before judgment was entered, case was removed to federal court. After notice of removal is filed in federal court, notice thereof is given to adverse parties, and copy of notice of removal is filed in state court, removal is effective, and state court is to proceed no further unless and until case is remanded. Musa v. Wells Fargo Delaware Trust Company, No. 1D15-0937, 2015 WL 9584864 (Fla. 1st DCA 2015).
Standing – Plaintiff failed to establish standing to foreclose, and the complaint was thus involuntarily dismissed, where evidence failed to establish that plaintiff became holder of note through special endorsement prior to filing the complaint. Elsman v. HSBC Bank USA, No. 5D14-1753, 2015 WL 9491875 (Fla. 5th DCA 2015).
Standing – Affirmative defenses – Plaintiff bank proved standing, but failed to refute defendants’ affirmative defenses, and thus it was error to enter summary judgment of foreclosure because genuine issues of material fact remained. Amstone v. Bank of New York Mellon, No. 2D14-5480, 2016 WL 56696 (Fla. 2d DCA 2016).
Standing – Plaintiff failed to prove series of transactions through which it acquired
note from original lender, and thus, it did not establish its standing, and defendant’s motion for involuntary dismissal was properly granted. Bank of New York Mellon Trust Company, N.A. v. Conley, No. 4D14-2430, 2016 WL 90758 (Fla. 4th DCA 2016).
Grounds Under Rule 1.540 – Lender’s dismissal of foreclosure action on law firm’s advice that it may be barred by statute of limitations was a mistake of judgmental or tactical error, and thus not a mistake that can be remedied under Rule 1.540(b), and court was without jurisdiction to proceed further. Cottrell v. Taylor, Bean & Whitaker Mortgage Corp, No. 2D14-5885, 2016 WL 97337 (Fla. 2d DCA 2016).
Notice of default – Bank voluntarily dismissed foreclosure action and six weeks later filed second foreclosure complaint based on the same default, and bank was not required to mail a second notice of default before filing the second action. Sill v. JPMorgan Chase Bank, National Association, No. 4D14-1014, 2016 WL 67256, (Fla. 4th DCA 2016).
Conditions precedent – Notice of assignment – Defense of failure to comply with notice requirement in Fla. Stat. § 559.715 must be pled with specificity; a general averment that plaintiff failed to comply with the statute is inadequate.
Deutsche Bank Nat. Trust Co. v. Quinion, No. 2D14-1560, 2016 WL 166648 (Fla. 2d DCA 2016).
Condominiums Records Request – Statute governing members’ requests for association records does not require association to deliver records to member, but simply to furnish member a reasonable opportunity to inspect and copy records upon request. Ridge Groves Condominium Ass’n v. Misserville, No. 2D14-3507, 2016 WL 166651 (Fla. 2d DCA 2016).
Creditors’ Rights Fraudulent transfers – Section 726.108, Florida Statutes authorizes money damages against both fraudulent transferor and transferee, jointly and severally. McCalla v. E. C. Kenyon Const. Co., Inc., No. 1D14-5225, 2016 WL 166732 (Fla. 1st DCA 2016).
Marketable Record Title Act MRTA does not extinguish restrictive covenants imposed by the county as a condition of land use approval because such restrictions are considered zoning regulations and do not affect marketability of title. Save Calusa Trust v. St. Andrews Holdings, Ltd., No. 3D14-2682 & 3D14-2690, 2016 WL 145997 (Fla. 3d DCA 2016).
CASE LAW UPDATES
LEGAL NEWS AND INDUSTRY UPDATES
Financial Crimes Enforcement Network (“FinCEN”)By: United States Department of Treasury | January 13, 2016 A FinCEN news release on January 13, 2016 announced that FinCEN had “issued Geographic Targeting Orders (GTO) that will temporarily require certain U.S. title insurance companies to identify the natural persons behind companies used to pay ‘all cash’ for high-end residential real estate in the Borough of Manhattan in New York City, New York, and Miami-Dade County, Florida.” The GTOs will be effective March 1, 2016, and will expire on August 27, 2016.
Big Banks Continue Retreat from MortgagesBy Jon Marino |CNBC| January 19, 2016
Big banks are lending less to homebuyers, or they’re making less on loans — and sometimes, it’s a combination of both.
US Home Builder Confidence Held Steady in JanuaryBy Martin Crutsinger |Associated Press | January 19, 2016
Confidence among U.S. home builders held steady in January even though builders’ expectations about future sales dipped slightly.
Mortgage Rates Retreat Over Global Economic ConcernsBy Kathy Orton | The Washington Post | January 14, 2016
Concern over the global economy is fueling volatility in the financial markets and pushing down rates on home loans.
Report: Governor’s Office Eyeing Bill Hager, Tom Grady for Insurance CommissionerBy Peter Schorsch | Florida Politics | January 12, 2016
Outgoing Florida Insurance Commissioner Kevin McCarty may have just turned in his resignation, but Gov. Rick Scott already is leaning toward his replacement: Tom Grady, former interim president of Citizens Property Insurance Corp.
Page 18First American Title | Florida Legal Eagle | Volume III, February/March 2016
REGIONAL AND STATE UNDERWRITING COUNSEL TEAM
FLORIDA STATEWIDE U N D E R W R I T E R S
Represents locations of FL underwriters
Alan McCallVP, SE Division Underwriting CounselD: 407.618.7935 | M: [email protected]
Patricia (Trish) LadanSr. Underwriting Counsel FL Associate State Counsel D: 407.691.5333 | M: [email protected]
John BalberchakSr. UnderwriterD: 850.296.3084 | M: 850.445.9323 [email protected]
Jennifer BloodworthSr. Underwriting CounselWinter Park: 407.691.5296 Sunrise: 954.839.2959M: [email protected]
Charles (Chip) KovalUnderwriting CounselD: 352.415.4765 | M: [email protected]
W. Wade WallaceUnderwriting CounselD: 239.676.3747 | M: [email protected] Response Team: [email protected]
Leonard (Len) PrescottVP, FL State CounselD: 305.908.6252 | M: [email protected]
Michael AltesUnderwriting CounselD: 904.858.9206 | M: [email protected]
Greg BlomeleyVP, UnderwriterD: 407.691.5210 | M: 850.445.9320 O: 407.691.5200 | [email protected] Rapid Response Team: [email protected]
William (Bill) BoyceSr. Underwriting CounselD: 727.549.3312 | M: [email protected] Response Team: [email protected]
Pat NewtonSr. Underwriting CounselD: 239.330.3328 | M: 239.272.1856 [email protected]
Sherri Wedesky UnderwriterD: 850.296.3170 | M: [email protected]
Page 19First American Title | Florida Legal Eagle | Volume III, February/March 2016
FLORIDA STATEWIDE AND SOUTH FLORIDA REGIONAL UNDERWRITERS
SOUTH FLORIDA UNDERWRITING TEAM
UNDERWRITING ASSOCIATES AND SUPPORT
BACKUP RESOURCES
Craig M. JontzVP, S. FL Agency Manager Underwriting Counsel D: 954.839.2916 | M: [email protected] Cenedella, AssistantD: 239.330.3329 | [email protected]
Keith C. Hendrix, C.L.S.VP, Sr. Commercial Title Examiner/UnderwriterTF: 800.916.7100 D: 407.691.5231 M: [email protected]
Joe RishelVP, Sr. UnderwriterD: 850.466.4152 M: [email protected]
Ashley R. LowderVP, FL State Agency Production ManagerD: 954.839.2954 | M: [email protected]
Michael KirkAssistant Vice PresidentD: 954.839.2912 | M: [email protected]
Linda SteerTitle ExaminerD: [email protected]
Gene BrownSr. Title ExaminerD: 954.839.2905 [email protected]
Ana B. LundgrenAssistant Title Operations ManagerD: [email protected]
Maria SturgilleTitle ExaminerD: [email protected]
Joan BrownSr. Title ExaminerD: [email protected]
Rose MarottaSr. Title ExaminerD: [email protected]
Gregory ZellSr. Title ExaminerD: [email protected]
Sheri GoodrichSr. Commercial Title ExaminerD: [email protected]
Mitch MonroeCommercial Title Examiner, UnderwriterD: [email protected]
Palma Collins VP, Division Underwriting CounselD: 703.480.9515 | M: [email protected]
John LaJoie VP, Corporate Sr. Underwriting CounselD: 850.296.3081 | M: 850.445.9303 [email protected] Ann Henning, AssistantD: 850.402.4101 ext 3082 [email protected]
Wayne Sobien SVP, Vacation Ownership Services DivisionD: 407.754.1320 | M: [email protected]
Carolyn (JoJo) Grove Underwriting AssociateD: [email protected]
Brenda YashinskyUnderwriting AssistantD: [email protected]
Page 20First American Title | Florida Legal Eagle | Volume III, February/March 2016