Simultaneous Policy

Cynthia Belzl, Operations Officer

There has been so much confusion in the industry about the Simultaneous Policy issue. RBJ has posted a video explaining the reasoning behind the rule and how to accomplish the calculations in RBJ.

RBJ has also written a feature allowing users to key in the full owner’s policy premium as a seller’s debit and the concurrent lender’s rate premium as a buyer’s debit,  for the purposes of the Closing/Settlement Statements, but the software will do the necessary calculations to show the adjusted owner’s premium, full lenders premium and offset as needed to accommodate the rule.  RBJ will be releasing the “Title Policy Adjustment” feature within the next few weeks.

An article has been posted to Housingwire entitled “Here’s how TRID is reshaping title companies.”  The article may be geared towards title companies, but the effects of TRID it discusses pertain to escrow. Here is a short bit from the article related to the simultaneous policy issue.  The full article can be found here.

When asked about the biggest challenges in dealing with TRID, Erin Sheckler, president of NexTitle responded:

“One of the biggest obstacles is disclosing title premiums under the rules of the CFPB. Since the Loan Estimate is intended to mirror the Closing Disclosure Form (CDF), title and settlement service providers must be mindful of how rates and fees are initially conveyed to the Lender – accuracy is critical. Rate calculators and other quoting services need to be updated to ensure that rates are disclosed as required under the rule. The single biggest challenge so far has been the calculation method required by the CFPB. It creates the necessity to disclose inaccurate title premiums in states where the lender’s title insurance premium is reduced when purchased simultaneously with owner’s title insurance. In areas where it is common for the seller to pay for the owner’s title insurance, the “cash to close” disclosed on both the Loan Estimate and the CDF may require manipulation, as well as the “cash from/to the seller” amount on the Seller’s CDF. This has been an incredibly difficult concept to impart to both the settlement agents and the lender. It’s created confusion and inaccuracy despite the stated goal of the CFPB of increased transparency.”