Do I really need to utilize a real estate attorney in the “attorney states”?
In most of these states (including Connecticut, Massachusetts, New York, Delaware, North Carolina, South Carolina, and Georgia), yes, it is absolutely necessary for a real estate attorney to oversee any real estate closing and issue title insurance. This determination may be a bit ambiguous in other states, but due to more strict rules and regulations throughout the industry, it is always a good idea to utilize an attorney who is best qualified to handle a real estate transaction. This practice will help you remain more compliant.
Does the CFPB rule enforcement increase my liability when it comes to working with third party vendors?
Absolutely. Under the new CFPB rules and regulations, lenders are now responsible for the conduct of their third party service providers. This means that if any party in the transaction is operating outside of compliance with the law, your organization may be financially and legally accountable. We recommend thoroughly vetting your third party service providers to ensure that they are compliant with all of the new CFPB Rules and ALTA Best Practices.
Penner Law Firm has developed an exclusive Third Party Service Provider Checklist to help you understand your responsibilities under the new CFPB Rules. To download your copy of this excusive checklist, click here or email email@example.com
How much time do I have to become compliant with the CFPB?
It is always best to address new rules and regulations as soon as possible. That being said, the CFPB does not expect lenders to be 100% compliant with applicable standards immediately. What they do expect is that lenders will exercise due diligence to be sure that they are taking the proper steps to become compliant with these new standards.
How do I best guarantee that I am working with a third party service provider that meets the standards required by the new CFPB Rules?
While there is no definitive answer to this question, there are a number of actions that you can take to stay ahead of the game, including, but not limited to:
- Ask your current third party service providers what actions they are taking to be compliant.
- Have they taken the time to get vetted by any agencies that specialize in legal compliance?
- Are they able to provide you with documentation that describes their standards and practices, including E&O coverage, Fidelity Insurance, licensing disclosures, resumes, and business continuity plans?
Penner Law Firm has developed an exclusive Third Party Service Provider Checklist to help you evaluate the copmliance of your third party service providers under the new CFPB Rules. To download your copy of this excusive checklist, click here or email firstname.lastname@example.org
Do I need to enter into a service-level agreement with current and future third party service providers?
This is a good practice. The CFPB mandates that lenders enter into contractual relationships with their service providers. This will not only go a long way towards ensuring that your service providers are legally compliant, but is an effective way to establish an expected service level from your vendor partners. Establishing a written agreement with third party service providers that outlines your expectations for compliance is also a great way to limit potential liability in the event of a compliance oversight by that third party service provider.
Penner Law Firm has developed an exclusive Third Party Service Provider Checklist to help you understand your responsibilities under the new CFPB Rules, and to evaluate the compliance of your third party service providers. To download your copy of this excusive checklist, click here or email email@example.com