Added oversight means added expense for homebuyers
Increased regulation on the title insurance industry will take a bite out of the wallets of homebuyers and refinancing homeowners in the District of Columbia in 2011.
Added oversight will likely amount to added fees and less room for negotiation, Todd Ewing, founder & president of Federal Title & Escrow Company, said just days after title insurance producers and companies operating in DC were placed under the regulation of the city’s Department of Insurance, Securities and Banking.
“Title insurance premiums will no longer be negotiable since DISB now requires all DC title insurers to file their respective rates by March 31, 2011,” Ewing said. “The requirement will likely result in overall higher title insurance premiums charged to homebuyers and refinancing homeowners.”
Homebuyers and refinancing homeowners should also expect to pay a $50 fee for the closing protection letters issued by title insurers to the respective mortgage lender, a new fee DISB now requires.
Title fees in the District of Columbia have steadily increased over the last couple years.Due to a higher number of title insurance claims, title insurance premiums significantly increased in 2009, Ewing said. Settlement fees increased in 2010 due to additional paperwork and liabilities imposed on lenders and settlement agents by the RESPA regulatory reform, he said.
The Title Insurance Producer Emergency Act of 2010, which passed in July 2010 and took effect January 1, placed title insurance producers and companies operating in DC under the regulation of DISB.
Federal Title upgraded its online closing cost quote tool to reflect the new requirements by DISB and will provide updates as new information regarding title insurance costs becomes available from DISB over the next few months