NEW Condominium Webinar

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Condominiums tend to be complex in the reverse mortgage world.  The future looks promising with the introduction of new proprietary products and the most recent FHA changes.  With the announcement of the new condo rule, we are launching a new webinar dedicated to a few hot topics pertaining to these property types. We’ll walk you though how to pull condos when you are purchasing marketing lists through ListSource and other key points to look out for when closing a reverse mortgage transaction with a condo.

Launching Thursday, September 19, 2019 – 10:00am PST/1:00pm EST

Click here to register.

Click here to read the RMD article about the new condo rule.

CertifID Video Library: Fraud Prevention

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CertifID has a video library dedicated to teaching you about different areas and focuses of fraud presented by Tom Cronkright, CEO & Co-Founder of CertifID.

Videos include:

  • New Fraud Trend: Cash-out Mortgage Refinances are Targets of New Fraud
  • Expanding Protection to Buyers
  • Hardware to Harden Your Security
  • How Does This Keep Happening

Click here to browse and pick up a new trick or two.

Guess who is coming to NRMLA?

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Click here to watch the video and get more clues.

Texas Rate Updates

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The Texas Commissioner of Insurance issued an Official Order making changes to rate and rate rules that will take effect September 1, 2019.

The changes to the rates include the following:

  • A decrease of 4.9% to the basic premium rate
  • The base rate tier for policies will now start at $25,000 (increased from the previous $10,000). This change effectively increases the minimum basic premium rate from $238 to $328.
  • Adjusts to create three new rate tiers for policies with face values from $25,000,001 and above to:
    • $25,000,001 to $50,000,000;
    • $50,000,001 to $100,000,000; and
    • More than $100,000,000.

You may review the Order here. There are also changes to R-5, R-8 and R-20 which you can view in the entirety by clicking on the previous links.

A summary of the changes to the rate rules is detailed below:

R-5 Simultaneous Issuance of Owner’s and Loan Policies

For loan policies of $5,000,000 or more when the ownership has not changed, the simultaneous issue premium can apply if the loan is issued within 90 days of the owner’s policy when covering identical property.

R-8 Mortgagee Policy, on a Loan to Take Up, Renew, Extend or Satisfy an Existing Lien(s) aka “Texas Refinance Credit”

The credit tiers have been simplified and adjusted such that there is now:

  • 50% credit within the first four years; and
  • 25% credit between four and eight years.

R-20 Owner’s Policy After Construction Period

Extends the time in which to get an owner’s policy after construction on deals of $5,000,000 or more at the basic minimum premium rate from one year to two years with a simultaneous issue rate for the loan policy.

What you need to know: 

  • The rate decrease applies only to the premium charged for policies, loan and owner’s policies.
  • The effective date (policy date) controls what premium rate should be charged.  If you anticipate the policy being dated September 1, 2019, or later, you should show the premium at the new amount. If you are unsure of the closing date, you should show both with one having a closing date of before September 1 and the other showing the closing date of on or after September 1, 2019.
  • New rate cards will be available through Stewart marketing.
  • If you accidentally charge too much, you should refund the overage promptly.
  • A number of the rate rules call for the minimum basic premium rate while other rate rules call for a computed rate that is less than the minimum basic premium rate that is charged (that feature is called “some” below).

Transaction codes affected by these changes:

  • R-5c Code 3280
  • R-5d Code 3280
  • R-8 Codes 4001,4002,4003,4004,4005,4006,4007
  • R-9 Code 0010
  • R-18 some Code 3011
  • R-20 some Code 1190
  • R-21 some Code 1250
  • R-22 some Code 1350

Real Life Example: How to Identify a Fraudulent Email

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Diligence is key when it comes to identifying fraud. Our Settlement Teams are a great example of being on the front line of defense. They recently received an email from First American and immediately noticed a few things were a little off. Upon further review they noted the items below leading them to report the email to our IT, delete the message and prevent fraudulent activity.

Clue #1: There wasn’t a name present on the To section.

Clue #2: When they placed their mouse over the download button it showed a suspicious website instead of the proposed “download”

Clue #3: They didn’t recognize the 833 area code and proceeded to call the phone number shown in the signature line with the intent of having them reference the escrow number or the property to confirm if we have an open file with them. When they called the line continued to ring with no answer.

By keeping an eye out for the items described above you can avoid falling victim to a potential scam. Share these simple steps with your co-workers, family, borrowers and with each act of prevention we take one step towards a more secure environment.

 

What can GeoCoverage do for you?

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TitleFlex is powered by DataTree and provides users with property details, transaction history, sales comparables and the ability to purchase recorded documents. TitleFlex is both a resourceful and user friendly tool for property profiles/searches, but there are some counties that don’t allow access to public records.

By using DataTree’s GeoCoverage in combination with TitleFlex you are able to search the county before running a property report to see whether the information you are looking for is available. This will save you time and some headache as you begin to search public records for data.

Example: IL, Brown County

Select the state and county of your property and refer to the bottom of the web page to see what information is available.

By running the county through GeoCoverage first we have identified that only property details are available, not sales comparables or transaction history.

Save a property hit by starting to search the county before running a property profile.

DataTree GeoCoverage – https://web.datatree.com/home/geocoverage

 

 

TitleFlex: Estimated Value vs. Full Value

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When retrieving sales comparables through TitleFlex you will come across two displays when reviewing the property value, either estimated value or full value.

Some counties are not permitted to release sales prices, TitleFlex then compiles all available data to provide you with an estimated value. It takes into account the value range, the properties around it, last sales, assessed value, and if it’s available from the assessor or the appraisal value market the improvement value. Essentially the estimated value is the price of the property within the market. See an example below of an estimated value display for sales comparables.

Below is an example of a full value display. A full value refers to how much was paid for the property the last time it was sold. 

 

 

Verify Wiring Instructions

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According to the FBI’s Internet Crime Report the Internet Crime Complaint Center (IC3) received 351,936 complaints in 2018. That’s an average of more than 900 each day. The most financially costly complaints involved business email compromise, romance or confidence fraud, and investment scams.

 

“Awareness is one powerful tool in efforts to combat and prevent these crimes. Reporting is another. The more information that comes to IC3, the better law enforcement is able to respond,” said Donne Gregory, chief of IC3. Click here to learn more about IC3 and file a complaint. Streamlined communication has assisted the FBI field offices in recovering funds for businesses that report fraudulent activity. In one case a victim wired $56,179.27 for a home purchase to a thief after receiving a spoofed email request from the lending agent. The Recovery Asset Team worked with the FBI Field Office and the victim’s bank to freeze the funds transfer and return $54,000 of the stolen money.

Click here to read IC3’s list of common and current scams.

Click here to read IC3’s internet crime prevention tips.

 

Although the complaints involved victims of every age, there was a concentration of financial losses for individuals over the age of 50. One way we can all do our part to prevent fraud is to verify wiring instructions. It’s great practice to validate wire instructions on each closing completed and ARS is here to help. We have master instructions available should you want to confirm or update any saved instructions you may have for our company.

 

Contact your Account Manager or Settlement Team for more information.

California Notices of Solar Contracts

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The recorded Notice of Solar Contract is just that – it is a notice informing us there is a contract between the homeowner and the solar company regarding leased solar equipment on the subject property. It is not the contract itself, and the contract is usually not recorded. It can be mistaken that if the solar company records a release of the Notice, any exception for the solar contract can be removed from the commitment/policy. However, releasing the Notice is kind of like that old adage about closing the barn door after the horse has escaped. You can release the Notice, but despite the Release we still have actual knowledge of the underlying contract because the Notice was recorded in the first place. We still know there is a contract out there that affects our property.

There are only two ways we can remove the exception for the solar contract: 1) The homeowner to provide us evidence that the solar contract itself has been terminated between the parties and that the solar panels and equipment have been removed from the property, which is usually accomplished by an inspection of the property. 2) The homeowner to buy out the solar contract so that he/she owns the panels and equipment outright.

The issue that title insurers have with these solar contracts has nothing to do with lien priority. The solar companies readily admit, and state in their documents, that the contract does not create a lien on the property. However, insurers are concerned because the Notice does impart knowledge that the solar facility is not part of the real property and that the solar company retains ownership of the solar facility and can enter the property and remove it, potentially causing damage to the property. Some of these contracts also grant the solar company certain easement rights over the property. While title companies are not willing to remove the exception except under the conditions mentioned earlier, they did create endorsements we can offer the lender (see attached example). They insure the lender against loss due to any impairment of the lien of the insured mortgage caused by the solar contract (addresses the lender’s main concern about lien priority), except to the extent that the solar contract discloses the solar company’s rights of ownership to the solar facility (addresses the insurer’s concern about ownership rights).

The only options regarding solar are: terminate the solar contract, buy it out, or take a policy with the exception (and endorsement, if so desired.) Additionally, if the lender agrees to take the exception (with or without the affidavit), amended closing instructions stating they will accept the exception on their policy will be required.

Example of a Solar Endorsement: Solar Endorsement

August Webinars

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The Borrower’s Experience – CRMP Cetified Course

Tuesday, August 14,  2019 – 10:00am PST/1:00pm EST 

This class will give the attendees a bird’s eye view of the entire process from Marketing to Post Closing of a reverse mortgage transaction.  It will cover some pit falls and how to avoid them. Although you may only handle one portion of the transaction, the borrower is a part of the whole process which can be overwhelming. We will explain how the attendees can be more empathetic to our borrower’s needs

Note: CRMP Credit not available for California residents. 

Click here to register.

 

Introduction to Powers of Attorney

Wednesday, August 21,  2019  10:00am PST/1:00pm EST

Reverse mortgages are complex and being prepared is key to a successful closing. Powers of Attorney are very common in the Reverse Mortgage industry. We are happy to share our experience and knowledge with you and together we can make the borrower’s experience a pleasant one.

Click here to register.