Lenders are under increased scrutiny by government to protect nonpublic personal information (NPI) of their customers, as dictated Federally by the Gramm-Leach-Bliley Act. They are being told to get control of their third-party vendors.
The bottom line is that title agencies who don’t comply with the new rules and don’t demonstrate they are compliant with best practices when it comes to handling, exchanging or storing NPI, will be unable to do business with the lenders.
The Consumer Financial Protection Bureau’s (CFPB) final rule for integrated mortgage disclosures goes into effect October 3, 2015 (proposed delay from August 1st: See News Release). The rule integrates forms required under the Truth-in-Lending Act (TILA) and Real Estate Settlement and Procedures Act (RESPA), and carries teeth!
|Diane Evans spoke on April 15 before a subcommittee of the House Financial Services Committee, where she urged a “hold harmless period of enforcement” from the August 1st deadline until the end of the year and for the passage of HR1195.|
In order to meet the challenge regarding the protection of NPI, the American Land Title Association (ALTA) has provided its members with a comprehensive guide outlining the association’s suggested “best practices”, which includes a section (Pillar 3) about how to properly store, handle and transmit electronic data so that the privacy of home owners is protected. No doubt, this degree of protection will be demanded by the lenders in order to comply with the new rules and avoid being fined.
Pillar 3 of these best practices clarifies what’s required of settlement agents regarding their I-T. These data privacy requirements (when the data is exchanged and stored digitally) is complex and very daunting, especially to the smaller title agencies which must rely on a multitude of third party vendors to employ these types of sophisticated technical services.
As the deadline for compliance of these new rules fast approaches, Click IT Compliance has formed a new product offering just for Title Agencies called Title Agency Compliance (TAC). TAC is a packaged solution specializing in helping title agencies meet or exceed all the regulatory requirements and become compliant with regard to their I-T. The TAC solution addresses the industry’s privacy and security concerns head-on, with bundled, approved and tested I-T services for the proper electronic storage, exchange and use of electronic data. (See Our Solution.)