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20 | TH E M R EP O RT FEATURE L enders and servicers are not the only ones finding themselves wading through the murky waters of regulatory compliance. Recent rule changes germinating in the mortgage industry have shaken up business as usual at title and escrow companies. For the sake of simplicity, title companies issue title insurance policies to assist in real estate transactions by ensuring that the acquisition or transfer of property interest can be affected with a maximum degree of efficiency, security, and safety. An escrow agent is responsible for the trans- fer of property from one party to another. They also secure the property and examine documents to make sure that the terms of the sale are met from both the buyer and seller during the transaction. As another (and valuable) piece in a borrower's mortgage origi- nation journey, title and closing companies have felt the effects of a prosperous housing market and new regulations from the Consumer Financial Protection Bureau (CFPB). Some have had to adapt their businesses to the new way of life while still meeting the expectations of closing mortgage deals with speed. Although the path to compliance has not been easy, many have managed to stay ahead of the curve. Swimming Upstream in a TRID-Rich Environment I t wasn't a surprise that the 1,888-page TILA-RESPA Inte- grated Disclosure (TRID) rule would result in administrative delays. But many didn't an- ticipate the repercussions of the delays to be so wide sweeping. The results of a study released in April by Washington-based Callahan & Associates found that a whopping 96 percent of the 200-plus credit union execu- tives surveyed reported closing delays related to TRID over the past six months. Surveyed across 46 states, Callahan found a variety of reasons at the heart of the delays in the TRID implementation period. Half cited new lender workflow between title companies and members, as well as a refine - ment of processes and procedures as the primary catalysts in closing delays. A quarter cited compli- ance issues related to settlement, systems, members, and mortgage disclosures. Sixteen percent said that their own mortgage loan origination and core processing systems were not fully equipped to handle necessary updates, while 6 percent said their members were unable to provide documentation and other information in a timely manner. Additionally, open-ended survey responses noted timing issues with disclosures, difficulties integrating mortgage origination systems with core processors, and challenges with title companies, realtors, and other settlement agents, Callahan stated. All told, more than half of the respondents said new TRID regulations have added five or more days to mortgage closing, while the average number of days to close, according to respondents, is 42. The industry's ideal average closing goal is 31 days. The title insurance and escrow settlement industry is experiencing a two-fold shift in its business environment: an exponential growth in local and federal regulatory oversight, coupled with unprecedented technological change, according to P.J. Ruokis, VP of Sales/Marketing, ATA National Title Group. "The lending and title industries have made great strides towards resolving those conflicts. Just as importantly, however, TRID has required substantial process chang - es and those will likely take much longer to fully implement," Ruokis stated. "While these regulatory and technological changes are challeng - ing, they are not insurmountable. The best settlement providers are mastering them while retaining their ability to provide depend - able, timely and accurate service to their customers." Larry Zielke, President of First Financial Title Agency of Minnesota, Inc., and managing part- ner of Shapiro & Zielke, LLP, and Tom Paschen, of the LOGS Group, noted that "TRID, and the changes necessitated in the processing of closings, is a significant challenge to the title and closing industry." The Consumer Disclosure Form (CDF) and the redesigned settle - ment statement are confusing for many borrowers and lenders, and they cause (sometimes significant) Murky TRID Waters, Everywhere How Some Companies Wading Through Heightened Regulations and Operational Barriers Are Navigating Their Way to Title and Closing Success By Xhevrije West