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If you watched President Biden’s State of The Union Address recently, you might have noticed that the subject of doing away with title insurance on some transactions came up. In my opinion, this is a hollow gesture—the cost of title insurance is not what makes home ownership prohibitively expensive for some Americans. And in reality, for a relatively small fee, it saves them from getting into situations that actually can be financially detrimental.
The Washington, D.C.-based advocacy group representing the title industry, the American Land Title Association (ALTA), criticized the pilot program, labeling it as a mere political maneuver that presents homeowners with misleading potential savings while amplifying financial risks for consumers, lenders, and taxpayers, characterizing it as a “purely political gesture offering a false promise of savings for homeowners while exposing consumers, lenders, and taxpayers to greater financial risk.” Read below the response from the National Association of Land Title Examiners and Abstractors (NALTEA). There is also a link and a sample letter to send to your government representatives. I will be sending my letters right away! Let me know what you think! State of the Union AddressNALTEA responds with A Call to ActionMarch 8, 2024The National Association of Land Title Examiners and Abstractors (NALTEA) is responding to the recent State of the Union address regarding title insurance reform. President Biden: “My administration is also eliminating title insurance fees for federally backed mortgages. When you refinance your home, this can save you $1000.00 or more.” We feel this action will further affect our livelihoods. Eliminating title insurance will not save American homeowners’ money. What it will do is systematically eliminate the need for our place in the industry. We are currently watching the responses from our own State representatives and are contacting our local title associations to gauge their reactions and discuss how we proceed with the information we currently have. However, we are being proactive in reaching out to our State representatives, Senate and House respectively, and voicing our concerns. We’re urging you to take action and contact your own State representatives. We have put together a suggested response (see below) that you may use, or you can create your own tailored to your personal experience. Also, please pass on this information to your clients, colleagues and friends. It’s important for us to get the word out. TO DO: You can use democracy.io to find your representatives and send your message to all at once, see an easy link button below. Choose HOUSING at the Topic. This is a free service. Subject: President Biden’s State of the Union statement on Title Insurance Dear (Representative), I’m urging you not to back the current Administration’s plan to eliminate Title Insurance fees for Federally backed mortgages. Owning property is considered part of the American dream, and title insurance protects this investment through lenders’ and owners’ policies. Title insurance is the essential protective by-product of the title search/abstract, which is the thorough examination of the public records. Collectively as a whole, it is designed to protect the investment by revealing potential defects in the title. Small businesses and independent title examiners and abstractors across the country will be affected negatively with the passage of legislation that eliminates title insurance or any products or requirements that pertains to a title search. I am aware that some reform should be taken across the board on many issues to help the American people obtain their own Dream. But destroying another’s Dream is not the answer. Please take into account the many small businesses and jobs that may be affected with any passage of legislature that will impact removing this requirement. Please support H.B. 5837, Protecting America Property Rights Act. Sincerely, [YOUR NAME] |
STATE OF THE UNION RESPONSE – CALL TO ACTION
Title insurance isn’t what makes housing unaffordable. Greedy developers and builders are.
Pandemic-era material prices & supply chain issues have gone away. Not all the way, but a lot. Yet builders have kept raising prices. In this area, $150/sf houses were $250-300/sf during the pandemic, but now as much as $400/sf.
Walk away. Find a mom & pop builder. Some of the smaller custom builders charge more now too, because the corporations get away with it. Walk away from them too.
Stick to what you can afford on a 15 year mortgage. Builders shouldn’t give houses away. But don’t sign up to be a slave for 30 years just so they can live a nice life on your income.
Sending letters to government representatives is a proactive step in ensuring that all aspects of homeownership are considered thoughtfully. Thanks for shedding light on this important issue!
I do believe that title insurance is necessary for both the lender and the home owner. You sure don’t want to buy your dream home only to find out that someone still has some sort of claim to it.
I strongly oppose achieving your dream by harming others. Let us not support this current administration’s plan. There must be a better way!
This situation underscores the delicate balance between consumer affordability and ensuring necessary protections for property owners.
That will harm the economy