This is part two of a two part blog that discusses how the country’s improved economic health will affect the real estate and title insurance industries as the 2014 spring buying season begins. Click here for part one.
Any part of the housing market that is touched by the banking system will have to be prepared for more and closer regulation (isn’t that all of us!?). Regulations and guidelines put forth by the Consumer Protection Finance Bureau (CFPB) will begin to apply to title agencies, generally as a requirement of working with large lenders.
One provision of the Dodd Frank Bill was to prevent banks from shifting liability to their third party vendors, like title insurance companies. Because banks now carry reputational risk for the actions of their vendors, banks will look to work with companies that can minimize the banks’ risk: those that put security protocols into place (to protect non-public private information of consumers) and follow best practices for operational excellence.
One thing banks may look for is whether or not a vendor is ISO27001 certified. Becoming ISO27001 compliant requires companies to follow protocols regarding security issues like asset management, access control, physical and data security, and operations management. It is unclear whether banks will require this or any other type of certification from their vendors. However, if vendors have not been certified or verified in anyway in terms of security and protection of consumer information, it is something they should look into.
At HDEP, we are far into the process of obtaining our ISO27001 certification. To learn more about the title insurance outsourcing services we provide, visit this resource page.
Please feel free to contact us with any questions.