Padgett Law Group
Menu

PLG NEWS

News + updates + recent press

Categories

All
ALABAMA
Arkansas
Bankruptcy
Case Law
Closings
Compliance
Evictions
FDCPA
FHA
Florida
Foreclosure
Georgia
Illinois
Indiana
Kentucky
Legislative
Michigan
Moratoriums
New Jersey
Ohio
PANDIFFERENT
Pennsylvania
Personnel
Real Estate
Regulatory
REO
Tennessee
Texas
Title
Trending Cases
USDA
WASHINGTON

Archives

April 2025
March 2025
February 2025
January 2025
December 2024
October 2024
August 2024
July 2024
June 2024
May 2024
March 2024
February 2024
August 2023
May 2023
April 2023
January 2023
November 2022
September 2022
August 2022
June 2022
April 2022
March 2022
September 2021
August 2021
July 2021
June 2021
May 2021
April 2021
March 2021
February 2021
January 2021
December 2020
October 2020
September 2020
August 2020
July 2020
June 2020
May 2020
April 2020
March 2020
February 2020
January 2020
December 2019
November 2019
October 2019
August 2019
June 2019
May 2019
April 2019
February 2019
January 2019
November 2018
October 2018
September 2018
August 2018
July 2018
June 2018
May 2018
March 2018
January 2018
December 2017
October 2017
September 2017
August 2017
July 2017

Moratoriums Impact Ease of Obtaining Title Insurance Policies When Closing on REOs

2/3/2021

 
Title insurance is a very important part of the REO transaction.  Originally resulting because of the CARES Act passed last March, several national title insurance companies issued bulletins to their agents regarding their various positions on what is needed for them to insure properties related to foreclosures.  This led to the title insurance companies placing additional requirements and restrictions in order for them to insure properties at REO following a foreclosure that was conducted while the Act was in place.  Although the Act itself has expired, the moratoriums are still in place and have been recently extended (again).  The national title insurance companies have expanded their bulletins to include the same or similar requirements for foreclosures occurring during the moratoriums going into this year.  At least one national title insurance company has taken a very conservative approach and will not insure any property related to a foreclosure action during the moratoriums, whether the property is vacant or abandoned.  These restrictions will apply to loans involving HUD, VA, Fannie Mae, Freddie Mac, or USDA.
It is important to understand how these requirements and restrictions will affect the REO process.  In order for the transaction to take place, any specific conditions relating to the foreclosure have to be satisfied so the title insurance company can issue title insurance at closing.  A determination of what additional steps or verifications may be required by the title insurance company must be made to avoid delays with the closing.  We recommend checking with the settlement agent early in the REO process to see which title insurance company is being used to make sure any extra steps required to get insurance are addressed well before the closing date.  The settlement agent should also verify whether the insurer has an overall prohibition on insuring these properties altogether so a different title insurance company can be used. 
​
Many of the title insurance companies have provided additional information in the bulletins and newsletters that they continue to be send out to their agents.  These requirements typically include written verifications or evidence that the property was vacant or abandoned and to show the moratoriums did not apply to the foreclosure of the property.  Some examples of the evidence the insurers may ask for are inspection reports, notices from local government that the property is vacant, findings of fact in the final order that the property was vacant in a judicial foreclosure, and statements from the servicer that the property was vacant or abandoned.  

Comments are closed.
    PLG BLOG DISCLAIMER
    ​The information contained on this blog shall not constitute legal advice or a legal opinion. The existence of or review and/or use of this blog or any information hereon does not and is not intended to create an attorney-client relationship. Further, no information on this blog should be construed as investment advice. Independent legal and financial advice should be sought before using any information obtained from this blog. It is important to note that the cases are subject to change with future court decisions or other changes in the law. For the most up-to-date information, please contact Padgett Law Group (“PLG”). PLG shall have no liability whatsoever to any user of this blog or any information contained hereon, for any claim(s) related in any way to the use of this blog.  Users hereby release and hold harmless PLG of and from any and all liability for any claim(s), whether based in contract or in tort, including, but not limited to, claims for lost profits or consequential, exemplary, incidental, indirect, special, or punitive damages arising from or related to their use of the information contained on this blog or their inability to use this blog. This Blog is provided on an "as is" basis without warranties of any kind, either express or implied, including, but not limited to, warranties of title or implied warranties of merchantability or fitness for a particular purpose. 
HOME
ABOUT
PRACTICE AREAS
CAREERS
CONTACT US
Picture
Picture

Padgett Law Group and Padgett Law Group EP are D/B/As of Timothy D. Padgett, P.A. Timothy D. Padgett, P.A.'s practice areas include creditors' rights, estate planning and probate, real estate transactions and litigation. Not all practices or services are available in all states in which Timothy D. Padgett, P.A. practices.
PRIVACY STATEMENT | WEBSITE DESIGN BY SQFT.MANAGEMENT
  • HOME
  • ABOUT PADGETT
    • THE DIFFERENCE
    • AFFILIATIONS
  • STATES OF SERVICE
    • FLORIDA
    • GEORGIA
    • TENNESSEE
    • ARKANSAS
    • TEXAS
    • OHIO
    • INDIANA
    • PENNSYLVANIA
    • NEW JERSEY
    • ALABAMA
    • MISSISSIPPI
  • PRACTICE AREAS
    • NATIONAL
    • FORECLOSURE
    • BANKRUPTCY
    • REGULATORY AFFAIRS
    • LITIGATION
    • REO, TITLE, & EVICTIONS
    • CLOSINGS
  • PLG NEWS
  • CAREERS
  • CLOSINGS
  • CONTACT US
  • HOME
  • ABOUT PADGETT
    • THE DIFFERENCE
    • AFFILIATIONS
  • STATES OF SERVICE
    • FLORIDA
    • GEORGIA
    • TENNESSEE
    • ARKANSAS
    • TEXAS
    • OHIO
    • INDIANA
    • PENNSYLVANIA
    • NEW JERSEY
    • ALABAMA
    • MISSISSIPPI
  • PRACTICE AREAS
    • NATIONAL
    • FORECLOSURE
    • BANKRUPTCY
    • REGULATORY AFFAIRS
    • LITIGATION
    • REO, TITLE, & EVICTIONS
    • CLOSINGS
  • PLG NEWS
  • CAREERS
  • CLOSINGS
  • CONTACT US