On March 7, 2014 Wells Fargo issued a bulletin to its settlement agents and approved attorney closers stating the lender “supports ALTA’s Best Practices and considers them to be guidelines for sound business practices that should ideally already be in place for businesses providing title and closing services for our customers.” We expect most other major home lenders to release similar statements in the near future and for the American Land Title Association’s (ALTA) Best Practices to become mandatory minimum standards in the near future.
Implementing the ALTA Best Practices is likely to involve substantial expense, technology upgrades, planning and procedure modification for most closing attorneys. It is anticipated lenders may require independent verification from outside ‘assessing entities,’ though it is unknown who will be able to complete assessments and what the cost of the assessment will be. It is also expected the cost of the assessment, if ultimately required, will be the responsibility of the closing attorney and will not be covered by either lenders or title insurers.
While Wells Fargo acknowledges the need for “transition time to enhance current best practices and fully implement the Best Practices,” no specific date was given for full implementation. We strongly encourage our insureds desiring to remain in the residential closing industry to review their practices and to work with their preferred title insurance underwriters to come into compliance.
To assist the best we can, staff attorneys with Lawyers Mutual have been working on a joint task force with representatives of the Real Property Section of the NC Bar Association, the North Carolina Real Estate Lawyers Association and the North Carolina Land Title Association to help members of the bar prepare for Best Practice implementation. Our insureds are strongly encouraged to frequently visit the joint task force’s website www.ncclosingattorneybestpractices.org for up to date information on the Best Practices, vendor lists and other resources assisting with compliance.