TITLE

Volume 78, Number 4

$5 per issue (member rate) $8 per issue (non-member rate) AMERICAN FEATURES LAND TITLE 11 Bring on the Bandwidth Your electronic pipeline is becoming more and ASSOCIATION more critical to the success of your title op­ eration, and the capabilities are growing ex­ ponentially. How do you quantify your "need for speed" today, or more importantly, for to­ morrow? Ted Smith explains everything you need to know about bandwidth, including an By Ted Smith easy-to-understand glossary of terms. Members Call Toll Free: 800-787-ALTA

Members Fax Toll Free: 1 4 Recollection of MDP Program Where can you learn about finance and cus­ 888-FAX-ALTA tomer service, while playing with balloons and hula hoops? At the Land Title lnstitute's Man­ Visit ALTA Home Page: agement Development Program, creative http:// www.alta.org By Patricia L. Berman, LT! courses combined with a practical curriculum Director of Education pack a powerful educational punch. E-Mail Feedback to: [email protected] 21 Westward Ho! to ALTA's Although summer is just hitting its stride, the 1999 Annual Convention time is here to plan for a wonderful fall trip to in Colorado the beautiful Broadmoor resort nestled in the On the Cover: Rocky Mountains of Colorado Springs. New educational programs and some unique tours Colorado's Rocky Mountains are By Liza Trey, ALTA Director of and activities are sure to make the Annual Con­ home to ALTA 's 1999 Annual Con­ Meetings and Conferences vention a "peak" experience for ALTA members. vention in Colorado Springs. Moun­ tain air and majestic views are sure to inspire attendees to reach 26 International Update How is the title insurance product faring off­ new heights, as they "blaze new shore? Bruce McKenna provides an updated trails" into the year 2000. For de­ glimpse of title insurance in other countries. tails, please turn to pages 20-21. Learn how title insurance and related services are expanding in the international market­ place, and where the challenges and opportu­ By Bruce McKenna nities lie in this important growth area.

32 Discover How ALTA's Retire­ The good news is unemployment is low. The ment Program Can Help bad news is unemployment is low! During this Recruitment and Retention period of low interest rates and low unemploy­ ment, title companies are fighting to hire and keep good employees. One way to help is by offering a strong benefits program. The ABRS program offers high-quality investment op­ tions and little-to-no administrative fees.

©1999 American Land Title Association. Title News was produced by ALTA and may not be distributed to non-ALTA members without permission of the American Land Title Association.

Title News is published bi-monthly by the American Land Title Association, 1828 L Street, NW, Suite 705, Washington, DC 20036. U.S. and Canadian subscription rates are $30 a year(member rate); $48 a year (non-member rate). For subscription information, call 1-S00-787-ALTA. Send address changes to: Title News, circulation manager, at the above stated address. Anyone is invited to contribute articles, reports and photographs concerning issues of the title industry. The Association, however, reserves the right to ed it all material submitted. Editorials and articles are not statements of Association policy, and do not necessarily refl ect the opinions of the editor or the Association. Reprints: Apply to the ed itor for permission to reprint either electronically or via hard copy any part of the magazine. Articles reprinted with permission must carry the following credit line: "Reprinted from Title News, the bi-monthly magazine published by the American Land Title Association." OMING VENTS

1999

23-24 Education Committee 7-9 Title Counsel Meeting LaJoUa, CA Key West, FL

24-27 Accountants Meeting 13-16 YRC Board Meeting Montreal, Canada San Francisco, CA

6-7 Systems Committee Las Vegas, NV 14 TIAC Board Meeting Grafton, VT 2000 15-17 Reinsurance Committee Meeting Woodstock, VT 13-15 Tech Forum 2000 28-30 Abstracter/Agent Research Las Vegas, NV Committee Meeting Annapolis, MD 27- March 3 Land Title Institute Managment Development Program Housron, TX

6-9 AL TA Annual Convention Colorado Springs, CO A MERI C A N LA ND TITLE A MESSAGE FROM THE PRESIDENT-ELECT AS SOCIATIO N s this is being written, the swirling forces of Congressional legislative ac­ tivity for financial services moderniza­ ASSOCIATION OFFlCERS A gyrations of the Federal President tion and the mystical Joseph M. Parker, Jr., Parker Title Reserve Board are front page news. Every­ Insurance Agency, Inc., Winston-Salem, NC where one turns there is yet another article (E-mail: jmpws@ao l. com) on the revolution of electronic commerce. President-Elect In recent years there has been a growing Charles H. Foster, Jr., LandAmerica Financial Group, Inc., Richmond, VA question from our traditional lender customer Treasurer base, and from emerging customer sets, as to Charles G. Gregory, Old Republic National the value proposition of title insurance. Now Title Ins . Co., Minneapolis, MN the protagonists for financial services modernization and mortgage Chair, Finance Committee reform seem to be viewing us more with disdain rather than as a Stanley B . Friedlander, Continental Title fac­ Agency Corporation, Cleveland, OH representative voice, and in some circumstances as a nuisance the solution. I see it as a troubling Chair, Title Insurance Underwriters tor rather than a contributor to Section indicator, but not a problem we cannot solve. Let's face it, these Patrick F. Stone, Fidelity National Title are confusing and frustrating times. We unfortunately seem to have Insurance Co., Santa Barbara, CA positioned ourselves as against things, trying to buy time, rather Board Representatives, Title Insurance for ways or conditions upon which we would begin to Underwriters Section than looking John N. Casbon, First American Title accept proposals of change. As I have come through the chairs of Insurance Company, New Orleans, LA Alan N . Prince, Chi cago Title Insurance Company, Chicago, IL Chair, Abstracters and Title Insurance "In recent years there has been Agents Section Cara L. Detring, Preferred Land Title a growing question from our Company, Farmington, MO traditional lender customer Board Representatives, Abstracters and Title Insurance Agents Section base, and from emerging cus­ Mark A. Bilbrey, Warranty Title and Abstract, Inc., EI Reno, OK tomer sets, as to the value Tony Winczewski, Commercial Partners proposition of title insurance. " Title, LLC , Minneapolis, MN Immediate Past President Malcolm S. Morris, Stewart Title Guaranty Co., Houston, TX of ASSOCIATION STAFF ALTA , I have come to appreciate the demands on the members Executive Vice President the staff of our trade association. James R. Maher In the next few weeks, the Board will convene to review the stra­ Director of Research tegic plans and direction of the Association. The value proposition Richard W. McCarthy of the ALTA will be brought under the microscope. It may be time Vice President- -Administration . It may be time for an overhaul. It certainly isn't time David R. McLaughlin for a tweaking for the status quo. Legislative Counsel Ann vom Eigen Director of Education Patricia L. Berman Director of Communications Lisa M. Cole Director of Meetings and Conferences Liza Trey Charles H. Foster, Jr. Director of Membership/Marketing M. Kathleen Hendrix Director of Information Systems and Technology Kelly Throckmorton Production Editor Susan M. Cicirelli Now you can search your local public records with the touch of a key.

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The Datatrace Advantage • Leading the nation in Title Plant Management for over 15 years. • Highly reliable, timely information indexed geographically. • Over 15,000 new public records posted daily. •Tax, prior policy information and public record document images ava ilable*. • Ability to generate national Ownership & Encumbrance reports in 48 hours or less in most cases. • Expertise in creating automated title plant services for local counties and joint t it le p lant opportunit ies. -=~.=.=. TM D , , ------• Unparalleled customer service with t ------loca l county expertise. Information Services For your local public record A LANDAMERICA needs with the touch of a key, call COMPANY Datatrace toll free at: National Headquarters 101 Gateway Centre Parkway • Gateway One • Richmond, VA 1-800-368-3380, or e-mail us at 23235 Tel: 800-368-3380 • Fax: 804-267-8832 [email protected]. E-mail : [email protected] Web site: www.Datatracelnfo.com

*May not be available in all parts of the US. Local Offices TIMS- is a registered trademark of Title Data, Inc., Houston, TX. Cleveland, OH • Detroit, Ml • Fort Lauderdale, FL • Tampa, FL Legislative/Regulatory Update· As of June 23, 1999

ISSUE SYNOPSIS STATUS/HI STORY

national bank powers has passed Limitation of national bank and In S. 900, national banks would be allowed to sell and Legislation expanding floor consideration in the financial holding company underwrite title insurance directly from the bank, from the Senate and is awaiting powers to sell and underwrite an operating subsidiary, or through a financial holding House. expected before the title insurance (parts o!H.R. 10/ company. ALTA was successful in achieving: 1.) favor­ 6/29 - House floor consideration S. 900, Financial Modernization able amendments in the House Banking Committee; July recess House Commerce Committee, Act of 1999) 2.) closing the "small towns" loophole in the House 6/20 - H.R. 10 passed Commerce Committee; 3.) limiting national banks "par­ voice vote ity" with state chartered banks to eliminate "wild card 5/6 - S. 900 passed Senate, 5544 provisions" linked to federal law as state authority to 3/ 11 - H.R. 10 passed House Banking Committee, 51-8 sell title insurance; 4.) report language to cover spe­ 3/4-S. 900 passed Senate Banking Committee, 11-9 cific state title laws.

Regulatory Expansion of the National banks have been seeking opinions from the The OCC has issued a series of opinions broadening in­ Powers of National Banks Office of the Comptroller of the Currency (OCC), the surance powers of national banks to sell insurance from regulator of national banks, to expand their ability to "small places." These cannot be challenged in court. sell title insurance.

RESPA Reform-proposed-new The Board of Governors of the Federal Reserve and ALTA testified at the only real estate industry hearing in 11 exemption from Section 8 for the Department of Housing and Urban Development the 105 ' Congress. ALTA supported improved consumer "packaged" settlement services submitted a report to Congress in July 1998 suggesting disclosure, but objected to an exemption from Section 8 reform proposals including a new RESPA Section 8 ex­ for "blind packaged" settlement services. No legislation emption for bundled closing costs. has been introduced in this session.

RESPA Yield Spread Premium HUD Statement of Policy on Yield Spread Premiums Implementation requirements for settlement agents. Lawsuits released on February 22, 1999 is primarily focused on The recipient of the YSP fee and the fee received from the yield spread premiums and the disclosures of these the lender is to be clearly labelled. Ex. "Mortgage bro­ payments. Clearer disclosures are required on both ker fee from lender to XYZ Corp. (P.O.C.)." the Good Faith Estimate and on the HUD-1.

Bankruptcy reform 0-1.R. 833/ ALTA obtained provisions overturning the Ninth Cir­ Late June - pending Senate consideration S. 625) McConville- title insurer cuit decision denying protection for lender's liens un­ 5/ 11 - placed on Senate calendar liability for undisclosed der section 549(c) of the Bankruptcy Code. 5/6- passed House, 313-108 bankruptcies 4/28- passed House Judiciary Committee, 22-13 4/27 - passed Senate Judiciary Committee, voice vote

effec­ Fannie Mae\ Freddie Mac Fannie Mae and Freddie Mac have issued a new uni­ Implementation required for sale transactions Uniform Instruments form instrument. tive July 1, 2000. Of interest to the title industry are the following: The instruments do not provide specific fees for specific services. However, there is language which provides that the lack of specific fee charges not be in­ terpreted as a prohibition. Notice Provisions: There have been no changes on the notice provisions relative to state foreclosure laws and due on sale provisions. However, there is a new provision applicable to both lenders and borrowers which allows parties to give notice that they have a problem with the security instrument.

Information Reporting on Quali­ Proposed IRS regulations on reporting of interest in­ 5/12- ALTA filed comment and testified at IRS hearing fied Settlement Funds come earned on qualified settlement funds set filing objecting to requirement that "escrow administrator," standards. rather than entity paying interest, file information reports.

Information Reporting on Real Administration proposal would increase information 4/28 - ALTA filed comment with IRS to replace current Estate Transactions: tax informa­ return penalty on incorrect filings from $50 to 5% of taxpayer identification number liability with good faith tion return penalty increase transaction amount (the house sales price) exemption. House Ways & Means and Senate Finance Committees - Action Pending

Information Reporting on IRS proposes regulations requiring filing of Form 1099- Comments due August 19. attorney fees MISC on attorney fees

Asset Forfeiture Q-1.R. 1658) Would adjust standard for "innocent owner" Summer '99 - pending House floor consideration 6/ 15 - passed House Judiciary Committee, 27-3

*Summary information. For more details please contact Ann vom Eigen, Legislative Counsel, or Charlie Frohman, Director of Grassroots Advocacy at 1-800-787-ALTA.

Title News- July/August 1999 7

NETWORKING As with all ALTA education, top Monday and Tuesday, allowing quality programming is the goal. attendees to take full advantage of OPPORTUNITIES To achieve it, professional speak­ a weekend stay-over. While the ABOUND AT ers and industry leaders are often conference is free, each attendee invited to speak to the Title must pay all individual expenses. 1999 Title Agents Agents Executive Conference. Attendance is by invitation only Executive Conference Below is a brief summary of the and is Limited to ALTA members 1999 program. grossing $1 .S million or more. To Learn more about this unique and valuable conference, please call By M. Kathleen Hendrix Plans are already underway for the 2000 Title Agents Executive Kathleen Hendrix, Director of Membership and Marketing, at Are you paying $1500 or more in Conference to be held at another 1-800-787ALTA. ALTA dues? If so, you qualify for sunny location. The conference the Title Agents Executive will again be scheduled on a Conference. Each year, Large Agent members of the American Land Title Association are invited 1S>S>S> TITLE AGENTS EXECUTIVE CONFERENCE to attend this unique and valuable (Held May 3 and 4, 1999, Phoenix, AZ) Attendees spend two conference. DAY ONE days networking with their peers and learning to handle important Presentation: Doing Business on the Internet issues affecting their industry. David Tandy, Stewart Information Services Corp., SISCO In 1995, the Title Agents John Gosselin, Gosselin & Associates, PC Executive Conference was creat­ Yes , you can actually use the Internet as a business tool! This presen­ ed from the meeting formerly tation focuses on how to increase business and make more money by called the Large Agents Meeting. using the Internet. Presented by a title insurance agent who is doing The original purpose of the Large business online and the underwriter whose technology makes it possi­ Agents Meeting was to better ble, this session caught everyone's attention. serve the needs of high-grossing, independent agents. Because Presentation and Discussion: Partnering with Banks to agents within this group typically Increase Your Business staff multiple locations and employ Ann vom Eigen, American Land Title Association out of the title industry, far more people than the average Although ALTA works every day to keep banks Join this informative discussion ALTA member, their needs are we know that their presence is a reality. bank progress and how you can best unique. Members sought an open to learn what is being done to slow forum that would allow free discus­ prepare for this business trend. sion of similar issues. The Title Cocktail Reception and Dinner Agents Executive Conference was established to serve that purpose. DAY TWO Each year, the Title Agents Executive Conference meets at a Discussion: Using the Media to Attract Customers different location, and a tour of a Gay Alberts Ruby, Ruby Communications how to build positive, mutually ben­ local title operation is the high­ This interactive workshop teaches directors from magazines, light of each conference. In fact, eficial relationships with editors and news stations. the decision of where to hold the newspapers, radio stations, and television media calls YOU when an Conference is based largely upon • Become a resource to the media so the where the group would like to expert opinion is needed. publicize your title company. tour. Typically, the site selected • Identify creative, inexpensive ways to image. for the tour is unique in someway, • Create and maintain a positive public and confidence. offering a glimpse into the future • Handle publicity challenges with knowledge of the industry. Attendees can Lunch catch a glimpse of how their peers operate, and they find it to be Tour of Stewart Title, Phoenix Office invaluable. Past meetings have Mr. Brian Hughes hosts this tour of the second most profitable Stewart been held in Denver, Chicago, and Title office in the nation. Mr. Hughes shares many insights into how he Las Vegas. The 1999 meeting was keeps this multi-office operation running smoothly. Join Mr. Hughes as held May 3 - 4 in Phoenix, Arizona. he reveals the secrets of this ultra-successful title operation. aooti a•rw:~... '::.~'!!:~ wno11H1 -•lllJ.911 Bring on the Bandwidth

By Ted Smith

andwidth is something your or­ grade as your company and ganization uses on a daily basis. desired network function "Whether you have a net­ B Like most of the finer things in grows. work today or not, the life, it is usually not noticed until it is gone. This short discussion of band­ I would encourage you to take the project of determining your width will include a working definition, latter (and higher) road, which involves organizations bandwidth a "how to" approach on evaluating your a detailed and well-documented techni­ business's need for speed, and an over­ cal approach. Although it is a somewhat needs involves the same view of some cost-effective telecommu­ technical exercise, determining your foundational questions. " nication options. business's "need for speed" does not need to be an intimidating undertaking. What Is It? It should be viewed as a very practical Our first goal should be to obtain what venture. (designed to go faster and faster) out might best be deemed a standard indus­ there on the market. However, you want try definition of what bandwidth is and How Much Speed do you Need? to measure the vendor's product against how it can be increased. The term As we walk through this "how to" ap­ your desired results, not flashy inter­ "bandwidth" refers to the amount of proach in evaluating your company's faces and pretty pictures. If you will take data, usually measured in bits-per-sec­ need for speed, try not to take any of the time to document the answers to the ond, that can be sent through a dedi­ the elements for granted. These points following questions you will be well on cated Oeased) transmission circuit. In need to be investigated as you define your way to having a blueprint show­ other words, "How much stuff you can your communication needs. It is impor­ ing where your company is technically send through a connection ... " as col­ tant that, before you begin to shop for and where you want the network to be league likes to say. A fast modem can system hardware, software and connec­ in terms of network functionality and move about 15,000 bits in one second; tivity options that you put together a faster processing or bandwidth. You will full-motion, and full-screen video would requirements document that expresses be able to speak with vendors and un­ require roughly 10,000,000 bits-per-sec­ your needs based on your company's derstand their product within the con­ ond, depending on compression. Al­ goals for a system. There are many great text of your needs. though this may be a bit optimistic, in software packages, lots of fancy hard­ Whether you have a network today practical terms a one-page text docu­ ware and multiple ways to communicate or not, the project of determining your ment can, all things considered, be organization's bandwidth needs involves transmitted in about one minute over a the same foundational questions worthy fast modem connection. of your company's consideration. As you In short, when one speaks of band­ Ted Smith began at Centex Title and evaluate your current Information Tech­ width it is a reference to the size and Insurance Operations' network in nology and network effectiveness in speed of a data circuit - or the ability of 1996 as a Network Specialist and terms of bandwidth, you may ask: How any network connection to move data, currently serves as the Network many users are in your organization? and at what relative speed. To increase Project Manager. Prior to joining the How will your people access the system? bandwidth, you can do one of two things: Centex Title team, Ted served as a Is your system running on a LAN Oocal Data Communication Technician area network) or WAN (wide area net­ You can buy all the latest with Dal-Tile, a 230-site Frame Re­ work)? Is your office a stand-alone office and greatest techie toys and lay network, for several years. Ted utilizing a local area network or is your tools simply because you is a graduate of Dallas Christian Col­ office one of multiple offices in your or­ can; or, lege and is currently juggling his ganization utilizing a wide area network? career, family life, and graduate How do you access your system? Do you You can buy only what you studies. connect via in-house connectivity need today and plan to up- (Ethernet, etc.)? Or do you utilize a wide

Title News- July/August 1999 11 area network approach via remote dial munications company providers, latas, your network. in connectivity, twenty-four seven WAN etc. In some markets and geographical However, if you have a technical sup­ connectivity, such as tacked up ISON areas you can "tack up" an ISON line port staff today you may need only a lines, dedicated circuits, or Internet con­ (leave the call placed 24/ 7) and bind the software package, basic hardware, or nectivity? After collecting this data, you channels providing 128k. For little more other monitoring tools in order to equip can determine how you are communicat­ than the cost of an analog line, you can in your folks to complete the project in ing today and how to look for ways to effect double your bandwidth. Beyond house. Do not be intimidated by the "bring on the bandwidth." ISON you might want to check out xDSL process. Allow your local telephone/ which claims a much faster stream of data telecommunications company and What are your Options? at comparable cost models to ISON. other service providers to work with It is important not to fall into the trap (Again, consult locally for prices in your your support staff, if applicable. To­ of thinking that one type of bandwidth market.) Note: ISON and xDSL lines are gether, they can perform evaluations of technology is best for your organization. often called dial-up connections as many the communication lines or data cir­ Although claims of super speed abound companies and individuals use them for cuits you currently utilize. Any telecom­ for some typologies, do your homework! dial on demand calls or transmissions. Yet munication vendor worth its salt should Document, test, and evaluate your com­ these circuits, in certain markets, can be be able to tell if you are within the lim­ munication needs. Note: One does not tacked up thereby functioning as a dedi­ its of productive bandwidth. I would need to choose between connection cated circuit at a third of the cost of true recommend increasing bandwidth if you types in order to arrive at the most dedicated circuits. When your communi­ are at 60 percent of your total available bandwidth for the cost. Many technolo­ cation needs exceed more bandwidth throughput. If you are maximizing your gies can work well together and comple­ than 128k, dedicated circuits are the way circuits, then it is time to upgrade to the ment each other for big bandwidth at a to go. Generally speaking, dedicated cir­ next level of circuitry or size: Bring on lower overall cost model. Our company cuits are more costly than dial-up connec­ the bandwidth! ~ utilizes both ISON and Frame Relay cir­ tions; however, some would say they are cuits on our network. (See Glossary for definitions.) We use ISON technology Sources Cited: when and where local call pricing and non-metered services are offered, and ''Although a technical http ://www. ma tis s e. n et / f i I es / we use Frame Relay when ISON is not exercise, determining your glossary.html#B cost effective, in those areas where long distance charges and metered services business s need for speed For further Reading: come into play. Fortunately, we have does not have to be an been able to create a pseudo "hub-ring" "The Internet Business Companion: typology in our major markets in Texas intimidating undertaking. Growing Your Business in the Electronic by going with Frame Relay (256k pipes) It should be viewed as a Age" by David Angel and Brent Heslop to centralized offices and then ISON (128k) to remote sites in that area. We very practical venture. " "Swtiching Technology in the Local Net­ are experimenting with Southwestern work: From LAN to Switched LAN to Vir­ Bell's version of xDSL, called ADSL, in tual LAN" by Mathais Hein and David the Austin area to the Internet and then Griffiths to our Network via our Tl Internet con­ also much more dependable. Our ISON nection to our ISP in the computer lines have proven themselves trustwor­ "Maximum Bandwidth: A Serious Guide room. For smaller offices and remote thy and stable. Dedicated circuits do have to High-Speed Networking" by Dan connectivity, we also offer analog mo­ their advantages, in that they offer at least Blanharski dem dial-up connections local and toll­ the 56k bandwidth of a typical dial-up line free to Cisco 2500 routers. and are scalable in the form of fractional "Voice and Data Communications Hand­ There are various options on the Tls. Frame Relay circuits provide a very book: Signature Edition" by B. J. Bates, market today to increase bandwidth. For scalable approach to networking and can Donald Gregory and Regis J. Bates. example you may have a small office cur­ be monitored easily. They are also good rently using a few PCs or terminals, some for long hauls across latas and geographi­ type of modem/router, and you may be cal areas. sending a small amount of data across the Finally, bandwidth is utilized in all of wire. A dial-up solution (28.8 as mentioned these various connection types but is above or up to 56k) may still be your best not limited to a discussion of just WAN option. However, as analog lines gener­ environments. Taking the view that all ally cost fifty dollars per month, you might data moves through any network con­ consider stepping up to an ISON line for nection at some speed or size, one real­ seventy-five dollars per month. (Note: izes that bandwidth in its truest form is Consult your local service providers, be­ a part of the economy of both WAN and cause mileage and markets vary; these LAN networks. Many companies special­ price quotes may not apply in your area.) ize in evaluating WANs and LANs or any The advantages of ISON are depen­ combination thereof and would be glad dent upon the local telephone/telecom- to have the opportunity to evaluate

12 Title News- July/August 1999 GLOSSARY

ADSL-(Asymmetric Digital Subscriber Line)­ ISDN- (lntegrated Services Digital Network)­ A circuit that passes data over existing telephone Like a modem line, but offering much more band­ lines. ADSL claims to be much faster than other width, a digital dial-up circuit capable of 56K per types of connections, 1.544 megabits per-sec­ channel-these channels can be bound for up to ond with data speeds of 128 kilobits per second 128K speed (requires a special modem or router). (requires a special modem or router). LAN-(Local Area Network)-A network that re­ ANALOG-Analog lines are commonly used for stricts its user-base to those located ONLY in the modem connections. The term analog refers to same physical location, floor or building. both the physical copper cable and the way data is transmitted over that cable through a local tele­ LATA-(Local Area & Transport Access)-A tele­ phone company's system switch. These switches phone company's geographical boundary of ser­ can provide both voice and data communication. vice, where dial-up calls are usually free. Note: Data over analog lines has limited trans­ mission speed because of the _narrow bandwidth ROUTER-A unit that allows two networks to be of voice lines. "routed" together by searching for a specific IP address across LANs and WANs and getting the DEDICATED CIRCUIT-A circuit, usually called data to specified locations. a "leased line;' that connects two networks to­ gether via WAN routers and some type of WAN T1-A leased line that offers a bundle of 56K cir­ protocol for consistent data flow and network ac­ cuits offering the bandwidth of 24 single channel cess. A 56K circuit offers the bandwidth of a single ISDN circuits. channel ISDN call. "TACKED UP"-A term used to describe a dial­ DIGITAL-When the same analog data is con­ up circuit, such as ISDN, that is used for dedi­ verted to digital data, via a digital switch, it can cated connectivity. Placing a call to another net­ be transmitted over digital signals faster and with­ work and leaving the call up twenty-four hours a out much distortion. Digital data is more precise, day, seven days a week -for anytime connectiv­ but does not have the transmit range of analog. ity (avoid per minute charges by staying within a specific LATA) . ETHERNET-One method and cabling type used to connect PCs, printers and/or terminals together WAN- (Wide Area Network)-A network that al­ with a File Server or Main Frame. lows those outside the physical location of the LAN to access the system using some type of dial up FRAME RELAY-A high bandwidth data circuit or dedicated circuit connectivity. service or protocol connecting two networks across some type of dedicated circuit in scalable xDSL-A generic representation of some form or bandwidth portions to end users (requires a product based on DSL, such as ADSL seen router). above. Some companies offer IDSL (ISDN Digital Subscriber Line) . "HUB-RING"-A term used to describe a net­ working concept where one office serves as a hub, or central point of contact, for other surround­ ing or remote sites.

Title News- July/August 1999 13 Recollection of LTI's 1999 Management Development Program

By Patricia L. Berman, LT! Director of Education

OW! It was quite a week for been assembled and will be available for positive. The quotation below is just the students, instructors, and viewing at the Land Title Institute table one of many complimentary responses W staff. Starting with Sunday's at future ALTA conventions. to the question, "Would you recommend Opening Session and receipt of their Analysis and feedback from the 119 this program to others?" Hartman Value Profile analysis, students graduates of the Class of 1999 were very "I would definitely recommend the experienced a week of intensive train­ program to others. In fact, I already ing, interspersed with some fun. Each have suggested it to two other manag­ of the five groups of 24 students devel­ ers. I think the information covered was oped a unique bond-friendships forged "One of the interesting very valuable and will strengthen the by mutual experience. The Manage­ developments of the pro­ skills of even a "seasoned" manager. An­ ment Development Program concluded other important aspect of the class was with a formal graduation ceremony, gram, and one not antici­ the sharing of ideas with respect to the complete with brief speeches, cheers, pated, was the group management issues that we all face. chants for planning a reunion, and the Within your own organization, some­ awarding of Certificates of Achievement. synergy... each group be- times it seems that there is only one way The electricity and excitement in the came a 'tribe, ' united to handle a certain situation. The MOP graduation ceremony were memorable. allowed for discussion of many differ­ Throughout the week, the students' together to do their best ent approaches to the same challenge." work and play activities provided many and to beat the rest, par­ photo opportunities. Included with this Demographics article is a sampling of the many pic­ ticularly in the customer The 119 graduates of the Class of 1999 tures taken depicting special moments. service course. " included 65 men and 54 women. Eighty­ A photo album of the Class of 1999 has one were agents and 38 were under-

Working together in small groups. Enjoying the wonderful weather and conversation with new "friends."

14 Title News- July/August 1999 writer employees. The graduates rep­ aging Change in the Title Industry." speakers and their topics were: resented 38 states. Some of our manager students have re­ turned to their offices to offer the Facilities Hartman Value Profile analysis to all Ginny Abiassi The facilities in the Hinton Center at their employees and have contracted Marketing Strategies Houston Baptist University (HBU) were with a consultant to offer explanations Stewart Title Guaranty Company top-notch. The classrooms were state­ of the individual profiles. Houston, TX of-the-art and adaptable to different con­ figurations for learning, such as small Hotel Accommodations and Private Janet A. Alpert group discussions and group projects. Bus Transportation to HBU Leadership Skills Some of our small group discussions The Westin Oaks in the Galleria was the Finance for Land Title Manager moved outdoors for an opportunity to primary hotel for attendees, although a LandAmerica Financial Group, Inc. develop a consensus and to enjoy the few students stayed at another facility. Richmond, VA warm temperatures and sunshine. We The Westin Oaks is adjacent to the Gal­ used multi-tiered classrooms, some leria, a large shopping center with nu­ Cara L. Detring rooms with movable worktables, two merous restaurants, stores, and an in­ Leadership Skills computer labs, and the sidewalks out­ door ice skating rink. Transportation Managing Change in the side for a mental exercise with two between the hotel and HBU was pro­ Title Business hoola hoops. vided by a private bus company, and we Preferred Land Title Company rode in style in brand new buses. Farmington, MO Program Accessories Upon their arrival on Sunday afternoon, Ice-Breaker Reception, Daily Meals Kenneth R. Jannen students received their MDP accesso­ and Evening Events Managing Change in the Title Business ries - a three-ring binder with more Sunday's Ice-Breaker Reception was Finance for Land Title Managers than 200 pages of printed materials, held on the top floor of the Westin Oaks First American Title Insurance badge, identification place card for their Hotel, which offered a panoramic view of Company classroom table, folder with pad of pa­ the uptown Houston area. HBU provided Fort Lauderdale, FL per and pen, carryall shoulder bag, and Continental breakfast and lunch all five their personal analysis of the Hartman days, as well as two dinners and enter­ Value Profile. tainment for students and faculty on Tues­ Reunion for Class of 1999 day and Thursday evenings. About half By popular request made during the Harbnan Value Profile of our students attended the rodeo at the graduation ceremony, a reunion for the According to evaluation forms and com­ Astrodome on Wednesday evening as Class of 1999 will most likely occur dur­ ments made while at HBU, students par­ guests of Stewart Title Guaranty Com­ ing the ALTA Annual Convention in Ha­ ticularly enjoyed the opportunity to pany. waii in 2000. learn about their personal strengths and weaknesses as identified by the Distinguished Industry Speakers Special Badges Hartman Value Profile. Dr. Steve Byrum We were most fortunate to have four Each of our 119 graduates has been provided two explanations of the very distirrnuished and knowledgeable given a special identification badge on Hartman Value Profile - first during the title industry experts present during the which is imprinted "MDP Graduate." If second half of Sunday's Opening Ses­ week, and they offered a title industry you see one of our graduates at a title sion, and then during his course "Man- "spin" on certain courses. Our guest industry function, please introduce

strings, One of the "customer service" classes lined up to hear the Working with construction paper, balloons, straws, rules of the outdoor exercise using two hoola hoops. and scotch tape.

Title News- July/August 1999 15 Call for Editorial Content

Title News, the official magazine of the title insur­ ance industry, is looking for a few good men and women.

One of the many groups posing for a photo on graduation day.

We're forming and ALTA yourself and ask about their experience on two of our top-rated MOP instructors. Editorial Advisory Group for the at LTI's Management Development Pro­ Dr. Karen Morton was eight months purpose of identifying new gram-they have tales to tell. Congratu­ pregnant when she taught the "Commu­ and interesting information for lations to the Class of 1999! nication/Listening Skills" course. She is Title News readers. now the proud mother of a daughter. Dr. Group Synergy Steve Byrum, our instructor on the One of the interesting developments of Hartman Value Profile and "Managing the program and one not anticipated was Change in the Title Business " course, the group synergy or group dynamics. has agreed to present an educational Each group become a "tribe" united to­ session entitled "Ethics in the Work­ If you have an interest or gether to do their best and to beat the place" at the 1999 ALTA Annual Conven­ background in communica­ rest, particularly in the customer service tion in Colorado Springs in October. tions, some fresh and interest­ course. One group called each other by ing story ideas, and would like their nicknames, chosen on the first day Next Year's Program to join this informal group, during an introduction lesson. People Because of the success of LTI's first Man­ please contact Lisa Cole, exchanged business cards, e-mail ad­ agement Development Program, we are ALTA Director of Communica­ dresses, and phone numbers because planning to offer the management/lead­ tions, at 1-800-787-ALTA, or they wanted to stay in touch with their ership course again next year­ [email protected]. "group." One of our graduates wrote: (roughly) the same time and same place. The dates for 2000 are February 27- "All in all, the week was a March 3. Course instruction will be held wonderful learning experi­ on the campus of Houston Baptist Uni­ ence steeped in much fun, versity, and hotel accommodations will laughter and camaraderie. be available at the Westin Oaks in the Age, sex, national origin, or Galleria. Due to an almost unanimous There will be no travel assoc­ title company made no dif­ request, next year we will insert some iated with this group, as all ference here. The network­ "free time" on Wednesday afternoon so communications will take ing crossed all precon­ that participants have an opportunity to place via fax, email, and ceived lines of underwriter/ sightsee, shop, maybe play golf, or rest. conference call. agent; your company vs. my Specific details about the 2000 MOP will company. We were one and be announced this Fall. ~ we wanted to win! You could not have walked away from this program un­ changed. For one week , in The Land Title Institute ( LT/) c reated the Man­ Thanks for your interest and Houston at the first annual agement Development Program in 1999 in re­ support. MOP, we were one-we were sponse to the title industry's needs, with the main united." objective being to give the industry a process to recognize, motivate, and groom its future lead­ Unique Faculty Development ers. Products o f LT/ also include seminars, vid­ I am delighted to report developments eotapes, and correspondence courses.

16 Title News- July/August 1999 Go AHEAD.

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SMS Title Works was developed to share pertinent information between all of the departments and systems you use to complete title orders. It automatically orders the title search . It displays your chain of title on screen and lets you tag the documents you want to see. Its sophisticated imaging system creates electronic file folders and retrieves the documents, starters and maps requested. It lets you create customized documents in a flexible Windows environment, utilizing SQL, Client Server, and so much more.

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800-767-7832 TITLE AND ESCROW SOFTWARE SOLUTIONS http://www.smscorp.com '*' America's Mortgage Loan Registry Volume 2, Issue 5 www.mersinc.org May 1999, Periodic Newsletter

MERS 1999Annual Meeting Bringing the Industry Together for a MERS Overcomes MOM i$'9;/i?. ~.~ Change: The Integration Forum Legal Challenge i$'9 (!aJ:f.a. -:?la.we a'9S~-:?I~ MERS held its third Annual Meeting on When was the last time you learned from your Some members recently encountered diffi­ April 29. We were pleased to report to the competitors how to lower your costs? That's culties in Massachusetts when they tried to shareholders that MERS finally seems to what the MERS integration Forum is all about; record their mortgages naming MERS as be delivering on its initial promise to save the opportunity to learn how to implement nominee for the originating lender (MOM) the mortgage industry money by eliminat­ MERS from members who have completed on registered land. Massachusetts is one ing assignments. The shareholders are their integration projects. of the few states where some land falls into happy so everybody's happy! Integration topics include strategies, planning, the category of registered land. The De­ lt hasn't been easy. As many of you know, and implementation of the business processes. partment of Land Registration in Ma sa­ we had to engineer a turnaround. MERS There is a three part agenda: chusetts is a separate unit from the regular was launched back in 1997 before approval section of the Registry of Deeds. The Land J) Updates on policy and procedure changes of MOM (MERS as Original Mortgagee). Court is a Department of the Massachusetts and system enhancements by MERS staffers, That meant that to register loans on the Trial Court, which has control over owner­ Fannie Mae, Freddie Mac, Ginnie Mae, the MERS® System a member had to create ship of real property which has been dis­ MBA and others. 2) Members share their ex­ puted at some point in history. an extra assignment. In other words, periences on one or more of the following sub­ MERS increased up-front costs in return jects: origination, retail, correspondents, ware­ This was the first time that the MOM for potential future savings over the life of house lending, post closing, loan servicing, concept had been challenged. In response, the loan. The MERS concept was going foreclosure, payoffs, acquisitions, bulk/mini­ MERS submitted a legal memorandum to nowhere fast because the value proposition bu l k sales and other subjects of interest. a Massachusetts Land Court Judge for a wasn't good enough. 3) The host leads a question and answer pe­ decision. We knew that the law supported Since then, we got approval for MOM from riod to address any subject presented by the our position, and therefore the Fannie Mae, Freddie Mac, Ginnie Mae, attendees. memorandum had a good chance of FHA and VA, and all four major wall street succeeding. MERS as Original Mortgagee rating agencies have approved it as well. (MOM) is based on the legal principle that Now our members eliminate an assignment a nominee is a legally acceptable way for a party to hold a mortgage on behalf of when they register a loan on the MERS® another party. The concept is in use System, so they save money up-front. nationwide. The Judge agreed with MERS MOM has completely changed the MERS and approved our request, directing that concept from a theory into something that all MOM documents presented to land will soon be a way of life in the entire court clerks in Massachusetts be accepted mortgage industry. for recording. The first integration To date, MERS members have registered forum was hosted in 1997 by First Nationwide Margaret Cronin, the Chief Title Examiner more than 300,000 loans. Of those, about Mortgage. Since then, Norwest Mortgage of the Massachusetts Land Court (who sup­ 23,000 are MOM loans. The daily MOM , Temple Inland and NationsBanc Mortgage ported the request) is now working on a registrations are growing at an increasi ng have each sponsored a forum. A member ho written memo to all land court clerks in rate. Every MOM loan saves at least $22 sts the one-day event and works with MERS Massachusetts to inform them of the Judge's in up-front assignment costs, so our to develop the agenda decision. lf a member experiences any dif­ members have saved $506,000 so far in and the invitation list. MERS/Alltel and ficulties with a land court clerk in record­ hard dollar savings using MERS. That MERS/Data-Link user groups meet the fol­ lowing morning with ing MOM mortgages on registered land in doesn't even count all the soft dollars they representatives from those companies Mas achusetts, the clerk should be told to have saved by eliminating the headaches to discuss future MERS en­ call Ms. Cronin directly. from those assignments. hancements. Who should attend a forum? Project leaders Foreclosures Complete By State and team members in any stage of their inte­ AK 0 This Month gration project; members willing to share with KY 0 NY 0 AL 0 LA 0 OH 0 others (and perhaps learn more themselves); AR 2 MERS 1999 Annual Meeting ...... 1 MA 0 OK 3 new members just beginning; software ven­ AZ 3 MD 0 OR 0 dor representatives who want to understand CA 29 ME 0 PA 0 Integration Forum ...... 1 co I Ml 2 RI 0 the MERS process; custodians and other in­ CT 0 MN 3 SC I MERS Overcomes MOM Challenge .. 1 terested parties. DC 0 MO 2 SD 0 DE 0 MS 0 TN I Merrill Lynch will host the next integration FL 4 MT I TX 13 MERS Software Available forum and user meetings on June 24- 25, 1999 GA 3 NC 0 UT 0 HJ 0 in Jacksonville, FL. Invitations will be mailed ND 0 VA I in LAN Version ...... 2 IA 0 NE 0 VT 0 mid-May. JD I NH 0 WA 0 IL 2 Race to Increased Profits ...... 2 NJ 0 Wl 0 If you need more infonnation about attending IN 0 NM 0 WV 0 or hosting a forum, please cal I Rachel Swanston KS 0 NV 2 WY 0 Alltel Adopts MERS User Group ... 2 of MERS, at l-800- 646-MERS (6377). Total: 74 MERS: Race to Increased Profitability LAN Ver.sion ofMERS g'~~OH~ Desktop Software lie The crush is on! As we begin to work with more and more new MERS Members, I pause and Internet E-mail Support think about the crowd crossing the starting line at the Freddie Mac sponsored run during the Now Available MBA Secondary Conference in New York. Taking the first steps with a new MERS Member B, t>.. 1/k&_,l/k is like starting the race. We establish our pace by developing a plan to finish at as fast a pace le and we win the race. The MERS Member Wins the Race by beginning to register &&re~ as possib loans. In doing this they get more than a T-SHIRT, they begin to save MONEY. Below are The MERS Desktop Software is two recent MERS Race Winners: now available in a version that runs on NT and Novell networks. Ameri-National Mortgage - Overland Park, KS This software is functionally iden­ When we first began integration activity with Jim Tinsman, Jr. - President of Arneri-National tical to the Desktop version except last year, Ameri-National was experiencing tremendous origination volume. that it is designed to allow PCs - in December that in January 1999 they attached to a server to access Great news for them, but it stalled the integration. Jim indicated M ERS from the server rather than would start again and get themselves "MERS-Ready''. He dedicated the resources of Mary from the hard drive of an indi­ McClure, their Project Manager, and by February they had registered their first MOM Loan. vidual PC. Any PC used to access Since then, we have seen the registrations flow onto the MERS system from Ameri-National the MERS software on the LAN daily. They have now begun their next stage of integration to begin using the MERS Desktop run Windows 95 or must still Software to register the loans themselves. Way to go Jim and Mary! higher or NT and have TCP/IP connectivity to the MERS environ­ Com Unity Lending - San Jose, CA ment. The LAN version will not Martha Collins-Berryman has been an inspiration to me. She always has a positive "can-do" support the MS Exchange client approach to getting her company "MERS-Ready". After many weeks of conference calls and (e-mail). However, you now have completion of scheduled changes to her mortgage documents to include the MOM language, the option to direct MERS to be­ Com Unity Lending has finished implementing MERS. Today, they are closing all loans on gin sending all MERS-related e­ is registering loans for them. mail to your designated Internet e­ MOM documents, affixing the MIN, and their trading partner mail address if you have an Martha, her IT Team and Thong Hong, CFO (and systems guru) are developing their MERS Internet e-mail provider. We will interface. Once integrated, they will do daily batch processing directly to MERS further auto­ assign the first part of your Internet mating their use of MERS. Congrats, team! e-mail address and yo u tell us the Call me at (770) 761-3226 or write to my e-mail remainder. We can also convert Join the race to increased profits today. .. any existing e-mai l addresses that address ([email protected]) to get an entry form into the MERS Race! And remember. you are using for the Desktop Ver­ "Every Loan Needs a MOM." sion. For instance, if your cu1Tent MERS e-mai 1 address is ADte/ Adopts MERS User Group J00)[email protected], g'~ 9.aMf 11~ we can convert the address to that utilize the Alltel MSP system in their ser­ l [email protected]. Since September 1998, several MERS Members Simply call us at 1-800-646- vicing operations have been meeting as an ad hoc Alltel/MERS User Group. The objective of MERS (6377) and ask for an e­ these meetings has been to provide feedback to Alltel on the existing MSP MERS functionality, mail conversion. We will coordi­ to document problems, prioritize future enhancements and to share experiences. nate the switch with you when you The information gathered so far has been used to help eliminate manual processes that had not have setup the new address with initial enhancement design. For example, concerns over incor­ your Internet provider. Please note been previously addressed in the of the past. that we can maintain only one rect county codes and the need for a MOM flag on the system will soon be a thing l nternet e-mail address per Orga­ Future functionality includes a dedicated MERS Screen containing loan level MERS data, a nizational ID number. Flow Transfer of Servicing indicator, and automation of the Foreclosure Reinstatement Process. Recently, this ad hoc group became an official entity as an advisory committee to the Alltel Loans McKee of Alltel was AMERICA'S MORTGAGE LoAN Added and Released (LAR) FAC (Functional Advisory Committee). Bob REGISTRY instrumental in getting the group formalized. MERS Members will be represented on the FAC PUULISllE:D MONTJILY (Old Kent Mortgage) as Chairperson of the MERS Subcommittee. Other MERS EDITOR: CARSON M ULLF.V by Carol Capek Co~TRIHUTING Eo1TORS: Subcommittee members include Jan Walsh (Aurora Loan Services), Marlene Ortlieb (Merrill MERS STAFF & GUESTS ENTERED F'IRST Ct.ASS MAIL Lynch Credit Corp.), Sue Haumesser (Bank of America Mortgage), Diane Coats (Wendover ANO I NTEIUVET MAIL Craig Thompson (Norwest Mortgage) and Barbara Frisch (Standard Federal). McLEAN. Vmc1N1A 1999. Funding), Corporale Offices: 820 I Greensboro Drive, We applaud Alltel for its ongoing support ofMERS and we look forward to working with the Suite 350 to continue building a seamless interface between Alltel and MERS. McLean, VA 22102 LAR subcommittee 1-800-646-MERS (63 77) Convention Schedule

Monday, October 4 3:00 p.m.-5:00 p.m. Registration Tuesday, October 5 8:00 a.m.-6:00 p.m. Registration 9:00 a.m.-11:00 a.m. Membership/Recruitment & Retention Committee Meeting 9:00 a.m.-5:00 p.m. Title Insurance Forms Committee Meeting 9:00 a.m.-5:00 p.m. Public Relations Committee Meeting 9:00 a.m.-5:00 p.m. Education Committee Meeting Noon-5:00 p.m. Land Title Systems Committee Meeting 1:00 p.m.-5:00 p.m. Miners to Millionaires City Tour (off-site tour) 2:00 p.m.-4:00 p.m. Government Affairs Committee Meeting Wednesday, October 6 8:00 a.m.-7:00 p.m. Convention Registration 9:00 a.m.-Noon Abstracters & Title Insurance Agents Section Executive Committee Meeting 9:00 a.m.-Noon Underwriter Section Executive Committee Meeting 9:00 a.m.-Noon Title Insurance Forms Committee Meeting 9:00 a.m.-1:00 p.m. Colorado Rockies Jeep Tour (off-site tour) 9:00 a.m.-5:00 p.m. Lender Counsel Meeting 9:00 a.m.-5:00 p.m. Life Counsel Meeting 11:00 a.m.-4:00 p.m. Affiliated Title Association Officer-Executive Brunch Session and Seminar Noon-3:00 p.m. Indian Land Claims Committee Meeting 1:00 p.m.-5:00 p.m. Miners to Millionaires City Tour (off-site tour) 1:30 p.m.-5:00 p.m. ALTA Board of Governors Meeting 5:30 p.m.-6:30 p.m. First Time Convention Attendee Mixer 6:30 p.m.-8:00 p.m. Ice-Breaker Reception

Thursday, October 7 5:30 a.m.-9:00 a.m. Hot Air Ballooning (off-site tour) 7:30 a.m.-8:15 a.m. TIPAC Board of Trustees Meeting & Breakfast 7:30 a.m.-8:15 a.m. International Development Committee Meeting 8:00 a.m.-1:30 p.m. Exhibits Open/Continental Breakfast 8:00 a.m.-4:45 p.m. Convention Registration 8:30 a.m.-11 :30 a.m. General Session 11:30 a.m.-Noon Title Insurance Abstracters/Agents Section Meeting 11:30 a.m.-Noon Title Insurance Underwriters Section Meeting Noon-1:15 p.m. Buffet Lunch in Exhibit Hall 12:15 p.m.-2:00 p.m. TIPAC Luncheon 12:30 p.m.-5:00 p.m. Pikes Peak Cog Railway (off-site tour) 2:00 p.m.-4:45 p.m. Exhibitor Information Sessions 2:00 p.m.-4:00 p.m. TIAC Board & Shareholders Meeting 2:15 p.m.-3:30 p.m. Educational Sessions

Friday, October 8 7:00 a.m.-8:15 a.m. SLRAC Meeting 7:00 a.m.-8:15 a.m. Abstracter/Agent Research Subcommittee Breakfast 8:00 a.m.-11:45 a.m. Exhibits Open/Continental Breakfast 8:00 a.m.-4:.30 p.m. Registration 8:30 a.m.-9:45 a.m. Educational Sessions 9:00 a.m.-2:00 p.m. Companion/Guest Event 10:15 a.m.-11:30 a.m. Educational Sessions Noon-1:15 p.m. Exhibit Hall Lunch 11 :45 p.m. Golf Tournament 1:00 p.m. Tennis Tournament

Satu day, October 9 8:00 a.m. :45 p(m. Registration 8:30 a.m.-1.30 p.m. Exhibits Open/Continental Breakfast 8:30 a.m.-11:30 a.m. General Session 9:00 a.m.-2:00 p.m. Soaring (off-site tour) 11:45 a.m.-Noon Executive Session Noon-1:30 p.m. Exhibit Hall Lunch 12:30 p.m.-4:30 p.m. Air Force Academy/Gardens of the Gods (off-site tour) 1:45 p.m.-4:45 p.m. Educational Sessions 6:30 p.m.-7:15 p.m. Reception 7:15 p.m.-11:30 p.m. Annual Banquet Blazing New Trails at the ALTA Convention

By Liza Trey, ALTA Director of Meetings and Conferences

Rocky Mountain resort, Shearburn, who will share her thoughts on of Pikes Peak. Sit back, relax, and take in nestled in the foothills of how to "Get a Good Life." the splendors of Colorado. (Departs 12:30 Pike's Peak, awaits ALTA's p.m., Friday.) 1999 Annual Convention WoH Blitzer Featured Soaring. Discover the freedom and fas­ attendees. The Broadmoor is one of the CNN Senior White House Correspondent, cinations of the finest form of flight. You premier resorts in the world; in addition Wolf Blitzer accepted ALTA's invitation as and a pilot will be towed a few thousand to the splendor of its majestic mountain Keynote Speaker for the General Session feet above the ground, then released to setting, it boasts time-honored traditions on Saturday, October 9. Blitzer has covered enjoy the beauty and quiet of motorless of outstanding service and extraordinary President Clinton since his election in No­ flight. (Departs 9:00 a.m., Saturday.) dedication to quality. To those who are vember 1996. Previously, he served as United States Air Force Academy & planning to enjoy it for the first time, CNN's Military Affairs Correspondent at Garden of the Gods Tours. At the Acad­ WELCOME. To those returning for yet an­ the Pentagon. Most notably, he was among emy, you will visit the famous Cadets other successful convention, the ALTA the team of CNN reporters who won the Chapel, Visitor's Center, and an authentic Convention will be everything you re­ prestigious GOLDEN ACE Award for their B-52 from a tour in Vietnam. After the Acad­ member, and more. coverage of the Gulf War. Don't miss this emy, you'll travel to the Garden of the Convention activities will be launched session to hear this well respected Gods, one of the most scenic areas in all of on Wednesday evening, October 6, when journalist's view of the world today. Colorado. (Departs 12:30 p.m., Saturday.) the International Center is transformed Other prominent guest speakers who into Colorado. Those attending will expe­ have accepted speaking invitations are The Broadmoor - Reservations rience the sites, tastes, and sounds of this RK. Arnold, president of MERS, and Mar­ Hotel accommodations may be reserved marvelous state. Colorado's Winter Won­ lin Fitzwater, who will be highlighting the by calling the Broadmoor at 1-800-634- derland will be brought inside the Rocky Title Industry Political Action Committee 7711, and identifying yourself as an ALTA Mountain Ballroom for the closing Banquet luncheon as guest commentator on Thurs­ Annual Convention attendee. Rates are Saturday night, where show time entertain­ day. Fitzwater served as press secretary between $205 for a Traditional Room and ment will be presented, along with music to Presidents Reagan and Bush. Today he up to $295 for a Premier Room, plus 8.1 % for dancing cheek to cheek. is an author, lecturer, and humorist whose tax, plus a daily service fee of $10 for In addition to the informative General presidential anecdotes, political analysis, single occupancy and $12.50 for double Sessions on Thursday and Saturday, a far­ and television commentary make him a occupancy. The hotel cutoff date is Sep­ reaching array of Educational Sessions will world wide celebrity. tember 3, 1999; a timely response is ad­ be available on Friday, including topics vised since the available room block is such as E-<:ommerce, changing technology Tours Widen Horizons expected to sell out. in the county recorders' offices, customer For an even wider perspective, take a tour! Convention registration fees have been service, and life after the title industry. For more information on the tours, con­ set at $460 for members and $240 for com­ Saturday afternoon will feature agency sult the preliminary program or call ALTA's panions and guests. ALTA members may management workshops which will in­ Meetings Department at 1-800-787-ALTA call the Association meetings department clude: Using the Media to Attract Custom­ Miners to Millionaires City Tour. A toll free at 1-800-787-ALTA for updates, and ers, Attracting and Keeping Good Employ­ motor coach tour of city highlights. (De­ to request registration forms. ees, and The Importance of Nonverbal parts 1:00 p.m., Tuesday and Wednesday.) Delta Air Lines (1-800-241-6760) and Communication in Title Negotiations. Colorado Rockies Jeep Tour. Get up American Airlines (1-800-433-1790) have The latest in technology available to the close and personal with the Colorado been designated as official carriers for the title industry will be showcased through Rockies in a open-sided jeep. (Departs 9:00 Convention, and may be contacted regard­ Convention exhibits and accompanying a.m., Wednesday.) ing discounted fares. For Delta, please re­ information sessions and other events fea­ Hot Air Ballooning. Come get your fer to star file #12041 lA; for American, star turing leading exhibitors. Rocky Mountain high! Take the ultra.quiet file #Sl 1569. Seats are limited, and certain Among the special attractions will be ride through scenic Colorado Springs. (De­ restrictions may apply. ~ Friday's companion/guest brunch at Cliff parts 5:30 a.m., Thursday.) House at Pikes Peak. Appearing as a guest Pikes Peak Cog Railway. Take an un­ speaker during the brunch will be Dudley forgettable trip to the 14,110 foot summit

Title News- July/August 1999 21 READY, SET. • • MERS

By Sharon McGann Horstkamp

"I have a document in front of me that American Title and Stewart Title are also policy. The other is on an assignment has this 'Mortgage Electronic thing' on members and shareholders. of mortgage. The latter is usually asso­ it. What is this, and what does it mean?" ciated with a bulk transfer of servicing. This is a question often asked by title What is the MERS® System? The appearance of MERS on these agents encountering their first MERS The MERS® System is an electronic da­ documents will allow you to perform document. Now that more and more lend­ tabase that was built by our technology your job more efficiently because it will ers are using the MERS® System, MERS is partner, Electronic Data Systems Corpo­ be much easier to perform title becoming visible in the title industry. ration, Inc. (EDS). It is through this da­ searches, and just as importantly, you This "Mortgage Electronic thing" is tabase that changes in servicing rights can access needed information quickly. a company called MERSCORP, Inc. It is and beneficial ownership interests are It is now possible for the chain of title a Delaware Corporation that is owned tracked electronically. It operates on to the mortgage to start and stop with by a broad base of organizations in the software that allows MERS members ac­ MERS. No more paper chase! mortgage industry. The name that you cess to a central database. It is a secured Let's talk about what you need to have seen or will see on mortgages, network. Members can access informa­ know if you see MERS on a mortgage or deeds of trust, assignments, lien re­ tion only on loans that are identified as deed of trust. First, why is MERS on the leases and other related documents, (if belonging to them. There are three lev­ mortgage or deed of trust? Second, is you haven't already) is its wholly-owned els of identity validation that must be MERS a lender now that it appears on subsidiary: Mortgage Electronic Regis­ entered in order for a member to access this document? tration Systems, Inc. (MERS). The sub­ the System: organizational number, op­ MERS appears on the mortgage or sidiary was created to be bankruptcy erator identification, and the operator's deed of trust for the sole purpose of remote and is named as the mortgagee password. holding title to the mortgage or deed of of record in a nominee capacity on all trust as a nominee for a MERS member. mortgages that are registered on the Having a Frrst-Time MERS Encounter Specific language appears on the secu­ MERS® System by MERS members. There are two ways that you will en­ rity instrument that allows MERS to be The appointment of MERS as the counter MERS as the mortgagee of the mortgagee as nominee for the mortgagee of record eliminates the need record. One is on a mortgage or deed of lender, its successors and assigns (this for any future assignments when servic­ trust for a newly originated loan on is called "MOM", which stands for MERS ing rights are sold from one MERS mem­ which you may be asked to write a title as Qriginal Mortgagee). ber to another. Instead of preparing a In the Fall of 1997, Fannie Mae, paper assignment, such as traditionally Freddie Mac, Ginnie Mae, FHA, and VA has been used to track the changes in all approved the use of MERS on the Sharon serves as servicing rights in the county land security instrument for loans sold to Corporate Counsel records, all subsequent transfers can them and registered on the MERS® Sys­ and Assistant Secre­ now be tracked electronically on the tem. In early 1998, Fannie and Freddie tary for Mortgage MERS® System because MERS always authorized changes to be made to the Electronic Registra­ remains the mortgagee of record for the uniform security instrument to accom­ tions Systems, Inc. servicer. There is no need to create as­ modate the addition of MERS as nomi­ She has worked signments once a loan is registered. nee for the lender. The four major Wall with Fannie Mae and Freddie Mac Who are MERS members? They are Street rating agencies, Moody's, Stan­ on policies and procedural changes organizations in the mortgage industry dard & Poor's, Fitch, and Duff & Phelps to the uniform security instruments. that fund , acquire, lend or service mort­ have approved the use of MOM as well. Sharon is a member of the New Jer­ gage loans including investors (Fannie Recently, Fannie Mae and Freddie sey State Bar and the Virginia State Mae and Freddie Mac) as well as organi­ Mac have revised their uniform instru­ Bar and received her law degree zations that are primarily engaged in pro­ ments, including slight revisions to the from the University of Richmond in viding services to the mortgage indus­ 1998 MOM language. There will be ap­ Richmond, VA. She may be reached try. Membership includes American proximately a one-year time period dur­ at 1-800-646-MERS or e-mail Land Title Association (ALTA), who also ing which some lenders may be using [email protected]. has a seat on our Board of Directors. First the old MOM document and others are

22 Title News- July/August 1999 beginning to use the new revised MOM owner of the indebtedness secured by out, the owner of the note, the lender in document. However, the substantive the insured mortgage, and each succes­ this case, will be covered under the policy content of both versions is the same. sor in ownership of such indebtedness." by the virtue of its ownership. One new change to the uniform in­ Mr. Bonita stated that in their present Therefore, if lenders are originating strument is to define MERS on each of form, these policies provide full cover­ loans in a broker's name using MERS as the state definition sections. Each state age to purchasers of the debt secured the nominee for the broker, the policy has its own form of security instrument, by mortgages made to MERS as the should list Mortgage Electronic Regis­ so there may be a slight variation in the nominee of the original lender. tration Systems, Inc. as the nominee for MERS definition from state to state. An Out of the handful of calls that we the broker, its successors, and assigns. example of representative language is: have received from title agents, most This should not cause an increase in the "MERS" is Mortgage Electronic Registra­ arose out of confusion over the lender's premium. tion Systems, Inc. MERS is a separate instructions given to the title agent corporation that is acting solely as a when a broker originated the mortgage Are You Lost Without Assignments? nominee for Lender and Lender's suc­ for the lender. For example, a title agent The answer is, "no." Instead, you should cessors and assigns. MERS is the mort­ received instructions to name the celebrate your good fortune! No more gagee under this Security Instrument. lender, i.e., the MERS member, on the wild goose chases tracking down a miss­ MERS is organized and existing under policy, but this member did not appear ing assignment. Fine, you say, that's the laws of Delaware, and is located at on the mortgage. Instead, a broker's great in theory, but then how do I know P. 0 . Box 2026, Flint, MI 48501-2026, tel. name was on the mortgage. The process that the loan has been sold to a new (888) 679-MERS. followed by this lender and broker be­ servicer if there is not an assignment re­ The instruments make it clear that fore converting to MOM mortgages was corded in the land records? the originating lender is still defined as to deliver an assignment from the bro­ Here is the part where the title in­ the Lender. MERS is not lending any ker to the lender concurrently with the dustry really sees the benefits of us­ money and will not be collecting any mortgage. The title policy listed the ing the MERS® System. The MERS® Sys­ money. Additional language is added so broker and made a reference of the tem has the unique ability to provide that the Borrower understands and assignment to the lender. that information to you instantaneously agrees that MERS holds only legal title However, this process changes when through a Voice Response Unit (VRU) to the interests granted by Borrower in a MOM mortgage document is used. If which is a toll-free number 1(888) 679- the Security Instrument, but, if neces­ MERS is named as the nominee for the MERS. The VRU provides the name and sary to comply with law or custom, broker, there will not be an assignment telephone number of the current MERS (as nominee for Lender and from the broker to the lender. That is servicer of a mortgage loan that is reg­ Lender's successors and assigns) has one of the advantages of originating istered on the MERS® System. Every the right: to exercise any or all of those mortgages naming MERS as the nomi­ mortgage that uses MOM language and interests, including, but not limited to, nee; the assignment from the broker to every assignment to MERS will be re­ the right to foreclose and sell the Prop­ the lender is eliminated. If the lender corded in the respective county land erty; and to take any action required of who uses a broker sends the same in­ records. All documents will have a Mort­ Lender including, but not limited to, structions to the title agent to name the gage Identification !'::!_umber (MIN) on it. releasing and canceling the Security In­ lender on the policy, it causes confusion This is an 18-

Title News- July/August 1999 23 Plus, don't worry that it will be im­ been registered on the MERS® System, loan will not be used again. possible to get through to the MERS® approximately 35,000 loans have been System. The average time it takes for a paid off. Occasionally I receive a phone What the Title Industry is search of the MERS® System is 8.0 sec­ call asking to explain why if MERS is the Doing to Get Ready for MERS onds. MERS monitors the response time mortgagee of record, is the check made ALTA is actively working to get the word on a monthly basis and will make ap­ payable to another entity. The explana­ out to all their members. The MERS propriate changes if needed for timely tion is that MERS is the mortgagee in a monthly newsletter is reproduced in responses. Also, MERS is developing a nominee capacity for the beneficial every issue of Title News. Some state member-only side to our current web­ owner. MERS is not servicing the loan land title associations have invited site that can access the MERS® System and therefore not collecting payments. MERS to speak at meetings and confer­ through the internet. This will be a big It is the servicer who processes the pay­ ences. The word on MERS is spreading, benefit to the title industry when the ment and prepares the necessary docu­ but a lot of title agents still need to be volume of loans on the MERS® System mentation for payoff. Out of the 35,000 reached. Some title companies are tak­ has substantially increased. This would loans paid off, only about 40 times have ing a proactive approach. allow a title agent to find the servicer I been requested to send a written let­ For instance, Stewart Title Guaranty information on a number of loans by ter assuring the title company that upon Company has issued a national bulletin Internet access instead of by inputting payoff to the servicer, a lien release will to all of its issuing offices explaining the MIN on a telephone keypad. be executed by MERS. MERS. On MOM mortgages, Stewart's Once the servicer receives the pay­ policy is to show the original beneficial What Happens When the Loan off funds, the lien release is prepared, owner on the mortgage as the insured. Pays Off? executed by an officer of MERS, and re­ If the lender requests, Mortgage Elec­ MERS is not the servicer of the loan, and corded. The mortgage is then de-acti­ tronic Registration Systems, Inc. can be cannot provide payoff information. What vated off of the MERS® System. If the VRU named as an additional insured. Jim MERS does provide is easy access to the is called for information on an already Gosdin, Senior Vice President and Se­ name and telephone number of the cur­ paid-off loan, you will be told 1) that nior Underwriting Counsel, spear­ rent servicer. This is an improvement the loan was de-activated on whatever headed this effort to educate Stewart over the current process where up to date it was de-activated, due to a pay­ agents. He states, "MERS will facilitate date assignments are frequently missing. off; 2) the name and telephone num­ Out of the 500,000 loans that have ber of the last servicer. The MIN for this continued on page 38

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ighteen months ago, I wrote veloped into the standard approach to These kinds of differences exist be­ about the developing market for assuring title to purchasers and lenders tween the United States and virtually ev­ E title insurance and related ser­ for a number of reasons related to the ery other country in the developed world. vices in Canada in an article entitled specific laws, recordation systems and As a result, it is convenient for competi­ "American Title Insurance: An Emerging business practices of the U.S. Historically, tors to argue that the conditions that gave Presence in Canada," published in the many of those factors were never as rise to title insurance in the United Sates January/February 1998 issue of Title prevalent in Canada. The standard of don't exist in their country, that every­ News. At that time, the degree to which Canada's registration regimes and the thing is "fine" and they don't need that title insurance had penetrated the Cana­ laws regarding solicitor's negligence were American product. I heard those argu­ dian market was relatively small, although generally reliable. Canada has had na­ ments in Ontario and Canada a number other countries' title insurance activities tional mortgage-lending institutions of times before our own bar insurer, Law­ had been touched upon by others. Title which performed the fund raising and al­ yers Professional Indemnity Corporation News published an article about title in­ location functions of the securitized mort­ (LPIC) decided, in 1996, to issue title in­ surance in Mexico in its January/Febru­ gage market in the United States. The surance policies itself. When I attended ary 1998 issue. Last September, the Inter­ chartered banks effectively serve as a the IBA program at its 1998 Vancouver national Bar Association held a program national clearing house for mortgage Conference, I heard variations on that at its 1998 Vancouver Conference entitled, funds. Finally, in Canada the federal In­ same theme from lawyers from England, "Title Insurance vs Investigation Of Title: terest Act contains a provision which al­ Germany, Spain, New Zealand and Austra­ Friend Or Foe?" with speakers from the lows individuals to prepay mortgage lia. Unfortunately, that argument, while United States, Canada, Australia, New loans after five years. Accordingly, a convenient way to attack title insurance, Zealand, and Europe. Title News also Canada has an effective 5-year limitation doesn't actually compare and analyze the published an article entitled "Going Glo­ on the terms of mortgages given by indi­ relative strengths and weaknesses of the bal: The U.S. Title Industry's Next Fron­ viduals and consequently does not have local title assurance approach and title tier" in its November/December 1998 is­ the long-term debt instruments which insurance. When the product compares sue. ALTA recently created an Interna­ would be more conducive to favorably, as it now does in Canada, its tional Development Committee under the securitization. adoption seems inevitable, despite the chairmanship of Mark Winter. historical differences. Title insurance and related services The basic characteristics necessary are expanding in the international mar­ The author is a partner for the provision of title insurance are: 1) ketplace and this article will update Title in Lang Michener that there is a reliable, systematic form News readers about developments here (Toronto). Bruce has of land in existence in the country in ques­ in Canada, as well as in a number of other written and lectured tion, and 2) that there exists a reasonable nations around the world. In Canada, extensively on title in­ system of enforceable laws to support there is a much higher degree of market surance in Canada. He that system. Accordingly, title insurers penetration by title insurers than there is the author of three are currently working in a number of was a year ago, with Land America join­ extensive sections on title insurance in countries around the world to help attain ing Chicago Title, First American, our bar the CCH Ontario Real Estate Law Guide, these basic pre-requisites so that a title insurer (Lawyers Professional Indemnity and is the contributing editor of the system and title insurance can operate. Corporation or "LPIC ''), and Stewart Title. book "Title Insurance -A Guide to Regu­ These countries include Bolivia, Costa The current market leader, First Ameri­ lation, Coverage and the Claims Process Rica, Hungary, Moldova, and St. Lucia. can, issued more than 100,000 policies last in Ontario " by Lang Michener. The au­ Stewart Title is the clear leader in assist­ year, a remarkable number when you con­ thor may be reached by telephone at ing nations in developing these standards. sider that title opinions were the only (416) 307-4112, or by e-mail at There are at least four strong chal­ available option just ten years ago. bmckenna@toronto. langmichener. ca. lenges that title insurance poses to the In the United States, title insurance de- various local title assurance systems

26 Title News- July/August 1999 around the world. The first, as with any Zealand Law Society's President, Ian advantage over traditional title investi­ commercial product, is cost. The second Hayes, made a speech entitled "Refocus­ gation approaches, which leave the risk is the ability to insure over hidden or fu­ ing the Conveyancing Debate, " in which during the "gap" period with the client. ture defects. The third is the manner in he suggested that real estate commis­ That last coverage can be particularly which title insurance responds to title sions, not legal fees, were the primary advantageous in England, where the cur­ defects or claims. The last is the impact drivers of conveyancing costs. New rent system permits vendors to sell to a of the modern global financial world. I Zealand lawyers are now entering the new purchaser at a better price where an will discuss each of these factors briefly, residential sales force. The best example offer is received before the conveyancing with examples of how they impact on of this approach comes from Scotland, process is completed. That process can other jurisdictions. with the Edinburgh Solicitors Property take from a few days to a few weeks, and Costs will vary, but title insurers are Centre (ESPC). Since its incorporation if the vendor accepts the new offer, the not political entities that have a goal of in 1971, the ESPC has grown to become original purchaser is considered to be "preaching the gospel," despite the elo­ a leading force in residential property "gazumped." Title insurance can speed quence of Mark Winter of Stewart Title, marketing throughout east-central Scot­ up the process and insure over the gap Hugh Brodkey of Chicago Title, Oscar land, with 1998 sales in excess of £1.l to eliminate the risk. This has been a Beasley of First American, and others. billion in residential property, about 90% material part of the First American mar­ Title insurers are corporations in the busi­ of the resale market in and around the keting program in England. ness of earning income for their share­ Edinburgh area. This sales system is The third challenge is the manner in holders and, given the investment re­ seen as a way for lawyers to recover their which title insurance responds to title quired to become licensed, hire staff, and defects or claims. Title insurance con­ market product in a new jurisdiction, they tracts are contracts of indemnity and the must have the clear belief that a profit­ "While the German duty-to-defend obligation in any such in­ able business will result from the contacts surance contract requires that insurers and clients developed. Since competitive speaker at the IBA confer­ take steps to defend and protect the price is the foundation of a successful ence proudly said that 'we insured's title. This is a positive obliga­ business, the insurers are operating tion that is different and higher than that where they feel that they can compete don't need your American under either statutory claims procedure successfully on that basis. money to fund our transac- or lawyers' errors and omissions policies, In Canada's largest province, Ontario, which do not respond until a purchaser all title insurers are routinely insuring tions, ' that statement is or lender has suffered a loss, which is then over residential survey issues and also re­ becoming less and less claimed. While commentators from vari­ ducing costs by not requiring that certain ous jurisdictions talk with pride of their searches or enquiries be completed. First true as time goes on and statutory or errors and omissions cover­ American offers "closing centres" that the world becomes a more age, such as the Solicitors' Indemnity provide standard services to assist (or integrated financial entity. " Fund in England, Lawyers Professional Li­ compete with) lawyers who carry out ability Insurance in Germany, the Solici­ such searches and enquiries individually tors' Fidelity Fund in New Zealand or LPIC for each purchaser. Stewart Title offers coverage in Ontario, none disputes the an "Examining Counsel" program, where residential conveyancing income and, superiority of the duty-to-defend obliga­ lawyers are paid a fee for the preparation while not a direct response to the pres­ tion in a title insurance policy. Indeed, of policy particulars. LPIC has reduced sures of title insurance, is often dis­ now that LPIC offers title insurance as well its premium levels and has recently made cussed in articles about title insurance as solicitor's errors and omissions cover­ its TitlePLUS policy available by phone as a way to protect lawyers' interests. age, it highlights the duty to defend in its or by fax as well as on-line. LPIC offers a The second challenge relates to the promotional material. fixed price to new home purchasers with ability of title insurers to insure over In addition, the various insurance certain approved lawyers. Price compe­ hidden or future defects, an area where funds of law societies around the world tition is fundamental to success in this they can compete very effectively. This have been under a great deal of pressure jurisdiction. is often discussed in the context of forg­ with the dramatic rise and fall of real es­ In England, First American is market­ ery, fraud, capacity, and marital status tate markets at the beginning of this de­ ing a title insurance system that it claims in the United States. While these argu­ cade. In the earlier issue of Title News, I will reduce the complexity, length and ments are relevant in other jurisdic­ outlined the LPIC deficit in Ontario. I can cost of the conveyancing process - halv­ tions, there are two other aspects of title report that the deficit has now been com­ ing costs. Stewart Title also offers title insurance which are just as valuable. pletely eliminated. The New Zealand So­ insurance in the English market. English One is the future coverage offered to licitors' Fidelity Fund is available to the solicitors point to the value and protec­ residential purchasers and lenders un­ client of a solicitor from whom the solici­ tion offered by the traditional conveyanc­ der extended-coverage policies. Such tor has misappropriated monies. Because ing system, but seem to concede that provisions are now being offered by all of a recent very significant claim, New there may be time and cost advantages of the title insurers in Canada. The other Zealand's solicitors were advised to pay to the title insurance approach. is insurance over the "gap"-the time a "top up" bill of NZ$10,000.00. In England, In this area, the arguments of the sup­ period from the date of the policy to the the Solicitor's Fidelity Fund is still in the porters of the traditional roles often fo­ completion of recordation. (See Title midst of resolving a serious deficit in ex­ cus on real estate agents rather than title News article in May/June issue, page cess of £$450 million. That deficit should insurers. In 1998, for example, the New 22.) Title insurance provides a material be paid off over the next five years. It is

Title News- July/August 1999 27 clearly not appropriate to say that solicitor's insurance plans around the world are necessarily effective and ad­ equate. The fourth challenge is the globaliza­ tion of the world financial community. Title insurance was developed in the United States to some extent because of the need to have national, not local, standards. As we move to a North American free-trade zone and a highly integrated world economy, the same problems that existed state-tcrstate in the 1930's now exist coun­ try-to-country. At the moment, not only is the title insurance industry in a position to cross international boundaries more easily than individual nations' errors and omissions programs, but it also has the advantage that America is the dominant player in the global economy. Title insur­ ance is a system that American multina­ tional corporations are familiar with. While the German speaker at the IBA conference proudly said that "we don't need your American money to fund our transactions," that statement is becoming less and less true as time goes on and the world be­ comes a more integrated financial entity. In addition to the countries specifically mentioned above, title insurance is being offered in Australia, South Korea and throughout Latin and South America. Title insurance is likely to be offered in any ju­ risdiction in which title insurers feel that Actually, it they can be competitively does responsive to the needs of the country and can compete effectively. Over the past few years, title insurance doWmdows: and related services have been offered more and more around the world. This is Need a hand around the office? With ProForm true not only in America's closest neigh­ boring countries - Canada, Mexico and for Windows, you'll get everything you expect countries in the Caribbean - but also in from the top-selling Closing and Title South America, Europe, Asia, and Austra­ lia. As there was in Canada, there are and Insurance software - one-time data entry, will be challenges from the suppliers of automatic calculation of all closing other local methods of assuring title, usu­ costs, and ally each country's bar. However, as has the best customer support in the business - happened in Canada, the products, skills, and expertise developed in America's plus the power to work right in Windows. highly competitive title insurance indus­ So go with the pros. Go with SoftPro. try, make growing acceptance for title in­ surance and related services likely. While Stewart and First American are most ac­ tive at the present time, all major insurers are soon likely to compete throughout this CORPORATION growing worldwide marketplace. ~

28 Title News- July/August 1999 ALTA has always been a great source of information. But we've just gotten a whole lot better.

ow you can get up-to-the-minute information via our Get the scoop on the latest acquisition, product release, website, www.alta.org. This is your top source for or new initiative announced by a national title insurer. N news about what's happening in Washington that af­ fects your business. Here are some great reasons to log on There's now just one stop for all this information, and its TODAY! updated nearly every hour of every business day. We've hired the same consultant that MBA uses to manage the govern­ Find out what Fannie Mae and Freddie Mac are up to! ment and industry news components of our website, and our We'll have the press release, a downloadable form, or a hot­ content has expanded dramatically. link to the actual language. If you're a member, you can access this information by Concerned about how FHA or VA changes will affect you? accessing our website and clicking on "Government Action," The ALTA website, www.alta.org, has the latest mortgage in­ or any of the "red-letter" items highlighted at the top left of surance and loan guarantee program changes. our homepage. You'll get a prompt for user name and pass­ word. (Previously sent to all members - if you've forgotten changes? Could they affect Heard about RFSPA's lastest them, please call 1-800-787-ALTA.) that joint venture you're considering? We'll have the press release or opinion letter available. If you're not a member and want access to this and other Find out what the experts are saying about interest rates! valuable member benefits, please contact Kathleen Hendrix Learn what the Realtors, MBA, the Homebuilders, or the Fed­ at 1-800-787-ALTA, ext. 230, or simply click on "About ALTA" eral Reserve Board thinks about mortgage interest rates or and "Membership Information" on our website. You can even other economic factors affecting our business. complete your membership application and pay dues online!

Now there's just one place you need to go for all your national mortgage finance and title industry news: www.alta.org!

==- It was t6PR1l1GTIU in the 8:16 ALTA Mid-Year Convention, March 1999

Werking Sess'

Charles T. Nichols pauses to reflect during an educational session. rps Color Guard provides a colorful kick-off r the opening session at the lnterContinental Hotel in New Orleans.

From left to right are Catherine Mullett, Dave C. Mullett, and Glenn Clements, proving that teaming can be fun.

ALTA President Joe Parker presents a prize to lucky winner Hardin Halsey.

Photos by Ken Abbinante Bill and Ann Thurman, and Mike and Winnie Currier enjoy a touch of class on their way to the Past Presidents' luncheon.

President Joe Parker and wife Linda take a stroll in the surreal surroundings of Mardi Gras World during the Ice­ Breaker Reception and parade.

~ '-'!~ .. . "the one that didn't get away" from Mark Cheney (photo by Sally Cheney.) Discover How ALTA's Retirement Program Can Help You Retain and Recruit Valuable Employees

ow ALTA's Retirement Program pant charges, depending upon which pending upon company asset size: MAPV can help you with your #1 prob­ plan and which provider you choose. for plans up to one million dollars in as­ N lem - retaining and recruiting (Please refer to your provider's plan for sets; Jumbo MAPV and Adapter for as­ valuable employees. As you know, re­ complete details.) sets in excess of one million dollars. tirement programs are increasingly im­ Further, for a company with 50 par­ portant to employees, making them a ticipants, these reduced fees can save Qualified Profit Sharing Plans with vital part of any first-class benefits pro­ your company from $105,500 to $133,000 Greater Benefits for You gram. over 25 years. Asset management fees New government regulations have come Today's labor shortage makes this re­ have also been reduced. This means to the rescue of the small business. Tra­ tirement program much more than just lower costs for each participant. For ditional employer contributions of a a great plan for retirement. It's really a larger cases (over $1 million in assets) profit sharing plan frequently allocate critical management tool for any busi­ pricing is even more aggressive. Even if the same percentage of salary to every ness owner competing for the same there are only a few employees in your employee. No particular employee could small pool of talented employees. And, organization, we offer you an excellent be favored because of salary level, age, it's specially designed for small busi­ and competitive retirement plan. length of service, or contribution to the nesses. So you get top-quality benefits Part of the cost reduction is due to profits of the business. Recent changes at significant cost savings. the volume discounts that ABRS nego­ in Federal law now allow business own­ The ALTA-endorsed plan with Ameri­ tiated with the insurance companies ers to contribute based upon needs can Buying Retirement Services, Inc. that administer the plans. rather than a single fixed percentage. (ABRS) features 401(k), profit sharing and One particular plan is called "New executive retirement plans; collectively High-Quality 40 I (k) Plans Provided Comparability." It offers small- to me­ branded as the "Prime Years" program. by Industry Leaders dium-sized companies a great deal of The plans stem from nationally recog­ ALTA offers members a choice of 401(k) flexibility. Now, employees can be di­ nized providers and are serviced by a plans provided by two highly rated in­ vided into classifications and each class network of more than 150 retirement spe­ dustry leaders. Both provide quality can receive an allocation different from cialists throughout the country. ABRS' program education and plan member the others. Employees can be grouped specialists have a focus on life insurance, services. Each one provides some according to salary, length of service, financial planning, and retirement plan­ unique features. One of them, for ex­ job classification or many other combi­ ning. Most are either CLU, ChFC, CFP and ample, offers 20+ investment options nations. PLUS you don't pay any costs have substantial experience. that include both institutional manag­ to administer your plan! Also, all instal­ ers and mutual funds. Your choices in­ lation charges and all administrative Reduced Fees clude an impressive collection of funds charges have been reduced or waived The start-up and administrative fees are with names like Janus, Delaware and because of your ALTA membership. especially important considerations for Fidelity. The line up of options also pro­ smaller companies. Dom Firmani, CLU, vides for the diversity requirement of Executive Retirement Plans ChFC, CPC, QPA, a financial expert and IRS section 404 (c) for employee invest­ Recent legislation limiting covered com­ president of Firmani Pension Services, ment direction. And, if your employees pensation for higher-paid executives in Inc., has more than 30 years experience want a very low-risk investment option, traditional qualified plans has created in the industry. Firmani has found with they also offer a Guaranteed account a climate of shrinking options. Compen­ other retirement programs, start-up option, which is backed by $26.1 billion sation caps for 1999 are below what they costs for companies with more than 15 in fixed maturities. were in 1993, leaving highly compen­ employees might be $1,000 to $5,000; The other provider offers partici­ sated executives with a form of reverse annual fixed administrative costs can pants a choice of more than 19 well­ discrimination when it comes to build­ run from $1,000 to $3,000; and annual known investment choices, including ing retirement income. ABRS is able to per-participant charges can range from Alger, Fidelity, Janus, Scudder, and provide several solutions. $25 to $40. When your company has Twentieth Century. This provider spe­ A value-added non-qualified execu­ more than 15 employees with the Ameri­ cializes in high-quality employee edu­ tive plan can be designed with a range can Buying plans, however, you have NO cation and communications before, dur­ of options while allowing your company start-up fees and can save up to 100% ing and after sign-up. Three plans and to select who will participate, the vest­ of annual administrative and per-partici- pricing opportunities are available de- ing requirements and how the plan will

32 Title News- July/August 1999 be designed and funded. There are three main categories: non-qualified deferred Traditional Qualified Plan Estimates: compensation plans; executive bonus plans; and split dollar plans. Each de­ Can you live on this percentage of your salary? sign offers advantages and disadvan­ tages, which an ABRS retirement spe­ Salary $70,000 $100,000 $150,000 $250,000 cialist can help you explore. Whether you're an executive of a 401(k) Plan Deposit $7 ,000 $10,000 $10,000 $10,000 small business or medium-sized com­ (10% of salary or pany, ABRS'executive compensation $10,000, whichever plans can help you avoid the high-in­ is less come obstacles with substantial cost­ AnnualBenefitatAge $20,696 $29,571 $29,571 $29,571 saving retirement plans. 65 from 401 (k) Plan More than 60 associations and cham­ bers have endorsed the ABRS program AnnualBenefitatAge $16,426 $16,426 $16,426 $16,426 for their members and employees. Those 65 from Social Security participants have discovered ABRS pro­ Total $37,122 $45,997 $45,997 $45,997 vides high-quality, significant savings and excellent local service. And, you get Percent of Salary 53.0% 46.0% 30 .7% 18.3% your choice of national providers. If you would like additional informa­ I. The maximum contribution for 1999 is $10,000. 2. Benefits from the 40l(k) Plan assume an individual age 45 has made contributions for 20 years; annual contributions tion on how we can help you recruit and increase 2% per year, 40l(k) assets accumulate at 8% annually; payout is based on a single life annuity. retain valuable employees, call the Mem­ 3. Social Security benefits are based on the 1999 scale. Please note: an individual age 45 in 1999 will not receive full Social Security benefits at age 65. Source: Pacific Life. ber Benefits Desk at 1-800-4954050. ~

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Title News- July/August 1999 33 Crestar Bank. He graduated from the University of Richmond and is a mem­ NAMES IN THE NEWS ber of the Treasury Management Asso­ ciation. Finally, LandAmerica recently an­ SAFECO Land Title of Dallas recently nounced the elect ion of Kathryn announced the naming of Roger A. Andriko and Craig Feder as vice-presi­ "Bob" Blanchard to the post of senior Klein Ramos d en ts and co-managers of the vice president and manager of the company's New York City National Com­ company's commercial office at LBJ and mercial Services offi ce. Ms. Andriko Preston Roads in Dallas. Blanchard has At LandAmerica Fi nancial Group in joined Lawyers Title as commercial been in the title industry for 19 years, is Richmond, Virginia, Thomas R. Klein transactions counsel in New York in a graduate of of the University of Arkan­ was recently elected senior vice-presi­ 1992. She graduated from Cornell Uni­ sas, obtained his juris doctor from The dent, affiliated agents. Klein originally versity and from Brooklyn Law School. University of Arkansas School of Law in joined Lawyers Title Insurance Corpora­ Feder also had joined Lawyers Title as 1977. Also at SAFECO, Dennis F. Houfek tion, a subsidiary of LandAmerica, as commercial tranactions counsel in 1992. has been named senior vice president of manager of the Southeastern Virginia He graduated from the State Un iversity its downtown Dallas special projects of­ office in Norfolk in 1987. He gradated of NewYork at Bi nghamton, and from fi ce; he earned his juris doctor and his from the University of Virginia with a B.A. Brooklyn Law School. B.A. from the University of Nebraska at degree and from the University of Rich­ Lincoln. A final SAFECO promotion has mond with a J.D. degree. Also at Paula Cokinos, Esq. has been ap­ Terry Kennon as the new senior vice LandAmerica, Ronald B. Ramos has pointed associate counsel to the legal president of SAFECO Land Title of Dal­ been appointed senior vice president staff of Advance Abstract Corp., located las. Kennon has a background in sales, and treasurer at the company's corpo­ in Great Neck, New York. She is a gradu­ acquisitions and dispositions, asset man­ rate headquarters in Richmond. Ramos ate of St. John's Law School and CW agement, new product development, fi­ joined Lawyers Title as assistant trea­ Post, LIU. For the past five years, her nance and portfolio liquidations. surer in 1992 following several years with specialty has been real estate law, and

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34 Title News- July/August 1999 she has represented several banks in marketing manager); Nancy Truskey (to sel for another major underwriter in their mortgage departments. marketing manager); Suzanne Williams Stamford. Also at Stewart, R. Cass At First American Title Insurance (to marketing director); Sharon Yarber Tinsely has been promoted to agency Company, Walter M. Reeves has been (to vice president, CTIC); Sandra Yohe manager in Region D. Tinsley will ser­ named senior vice-president, national (to escrow manager). vice Stewart's agents and attorneys accounts. Working out of the Santa Ana, In New Mexico, Steve Parsley of Rio while building contacts to increase CA corporate office, Reeves will oversee Grande Title has decided to move to Las Stewart's presence in the market. He national account operations throughout Cruces and will be taking a new position holds a J.D. from Cumberland School the country. there. Also at Rio Grande, Mark Bidwell of Law in Birmingham, AL. At Chicago Title and Trust Company, has been promoted to president and G. Bickford Shaw, executive vice the following have received promotions: Doug Stuart to executive vice president. president and general counsel for Title Diana Bannon (to branch manager and Roy Bidwell continues as CEO. Insurance Company of America in Aus­ "Title Man of the senior escrow officer); Rick Connors (to At the Texas Land Title Association tin, TX was named TLTA. Shaw received the high­ president and manager, Real Estate In­ (TLTA) Annual Convention, Stephen A. Year" by est honor conferred by TLTA, of which dex, Inc.); Jerry Croft (associate re­ Hester, Jr., Southwest agency counsel he was president from 1994-1995, and gional counsel); Shelley Despotakis (to for Chicago Title Insurance Company, is a 25-year veteran of the title insurance manager); Leslie Faught (to was installed as the 1999-2000 president marketing industry. At the same TLTA Convention, of TLTA. He will serve one year, succeed­ marketing manager); Kimberly Bill Thurman, president-emeritus of ing William G. Moize. Also at TLTA, J.W. McAndrew (to assistant vice president, Gracy Title Company in Austin, and Don "Kirk" Kuykendall was named presi­ CTIC and Ticor Title, remaining C&I un­ H. Still (recently retired) were named derwriting counsel, Philadelphia); dent-elect for 1999-2000. as "Honorary Members for Sustained Theresa Murphy (to vice president, At Stewart Title Guaranty Company, Meritorious Service" of TLTA. mortgage operations, Chicago Title Marina Sadownick has been appointed Finally, TLTA named Lorrie Cornett­ Credit Services, Inc., Kingston, NY); Lisa Connecticut state counsel. Ms . Cotton the latest recipient of the TLTA's Peck (to assistant vice-president, CTIC Sadwonick graduated from the Pact President's Award, and Ginny Abiassi and Ticor Title); Diana Sabol-Falcone University School of Law and has sup­ was awarded the "Peggy Hayes Teach­ (to assistant vice-president, CTIC and ported commercial and residential ing Excellence Award" by the Texas As­ Ticor Title); Kathleen Straughan (to closing, serving for six years as coun- sociation . .. Have You Digitized Your Official Records Yet?

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Title News- July/August 1999 35 I ect

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Title Program Administrators 5225 N. Central Avenue, Suite 110 Phoenix, AZ 85012 - Phone: 800-277-5680 Fax: 602-404-9933 Internet: www.titleprogram.com - email: [email protected] LENNAR TITLE SERVICES, INC. "Partnering with Banks" Miami, Florida Telephone Seminar: Has acquired the assets and business Not Too Late to Order Audio Tape of LAND TITLE COMPANY n June 16, ALTA sponsored its SOUTHWEST third telephone seminar, en­ Dallas, Texas O titled "Partnering with Banks - Essential for Survival or Financial Disaster?" The purpose was to provide information for effective strategic busi­ REGULATORY RESEARCH CORPORATION ness planning. From 136 different office locations, more than 350 persons lis­ Acted as Consultant to Lennar tened to and asked questions of three speakers who addressed five critical Dr. Nelson R. Lipshutz, President topics: 24 Radcliff Road Waban, Massachusetts 02468-2222 • How to partner legally ( 617)964-6940 • Mandatory RESPA requirements for these new partnerships

• Choosing a valuable lender business partner LENNAR TITLE SERVICES, INC. • Pro's and con's of pending federal Miami, Florida legislation Has acquired the assets and business of • What the national bank regulator says you can and cannot do REPUBLIC TITLE COMPANY OF The seminar speakers were: Ann vom OLD Eigen, ALTA Legislative Counsel; FORT WORTH Sheldon E. Hochberg, Partner, Steptoe & Johnson, LLP, Washington, DC; and Fort Worth, Texas James Gosdin, Senior Vice President and Senior Underwriting Counsel, Stewart Title Guaranty Company, Houston, TX. and If you were unable to participate in the "Partnering with Banks" program, COMPANY OF you still have an opportunity to hear ev­ OLD REPUBLIC TITLE erything that was said during the 90- CLEBURNE minute seminar, including the interactive Q&A session. These audio materials en­ Cleburne, Texas able you to share with colleagues who could not attend the telephone seminar, keep a copy in your office archives, and/ or keep a copy for yourself to use as a REGULATORY RESEARCH CORPORATION handy reference. The audiocassette and Acted as Consultant to Lennar materials package (identified as ALTS 124-0) may be purchased from KRM Information Services, Inc. , at 1-800-775- Dr. Nelson R. Lipshutz, President 7645, for $140 + $5.50 shipping and han­ 24 Radcliff Road dling. Please have your information, in­ Waban, Massachusetts 02468-2222 cluding credit card, ready. ~ ( 61 7)964-6940

Title News- July/August 1999 37 MERS continued from page 24 1999 Affiliated TITLE NEWS production of payoffs and will assure that we receive satisfactory releases of mort­ Association ADVERTISERS gages. Because of the MERS involvement in the real estate process, we expect that Conventions Amitech ...... page 35 we too will be more efficient. MERS is one July Corporate Development Services of the best ideas in real estate to develop in recent times." 8-10 Illinois, Heidel House Resort, Green ...... page 38 Lake, W1 First American is currently working Datatrace . page 6 on a memorandum to send out to its 18-20 Michigan, Shanty Creek Resort, Elliptus . cover 2 offices and will be placing information Bellaire, MI about MERS on its web-site. It sees the EscrowData.com . . . . . cover 4 value of educating its agents up front 22-24 Utah, Sun Valley, ID North American Title Organization on this timely topic...... page 34 Information about MERS is out there. August This article is the second one to appear 5-7 Montana, Fairmont Hot Springs Resort, RamQuest ...... page 10 in Title News. You can also visit the Fairmont, MT Regulatory Research Corporation MERS web-site for information at www.mersinc.org 5-8 Idaho, McCall, ID . page 37 . Conclusion 8-11 New York, Charleston Place, Charles­ SMS ...... page 17 ton, SC SoftPro Corporation . page 28 The number of mortgages registered on the MERS® System exceeds 500,000 12-14 Indiana, Omni Severin Hotel, India­ Title Data, Inc. . . . . cover 3 and is increasing daily as more and napolis, IN Title Guaranty of Hawaii . . page 33 more lenders are registering loans. By 12-15 North Carolina, Grove Park Inn & the end of this year, one million loans TitlePac ...... page 25 Resort, Asheville, NC will have been registered. There are Title Pro . page 24 currently 26 members registering loans, 13-15 Minnesota, Breezy Point Resort, but this number is quickly rising. MERS Brainerd, MN Title Program . . page 36 is here, so Ready, Set ... MERS. 19-21 Kansas, Overland Park Marriott, l,;;lt;Vt;llUI~~.,,""' l,;;\.llLIUll Overland Park, KS CDS Performance of Title Insurance 19-21 Wyoming, Holiday Inn, Rock Springs, WY Companies Lawrence E. Kirwin, Editor September 9-11 Missouri, Westin Crown Center, Kan­ Comprehensive Data Detailed Analysis sas City, MO .../ All U.S. Title Insurance .../ 44 Ratios Measure and Rank Each 12-14 Ohio, Dayton Marriott, Dayton, OH Companies Compared Company's Performance

16-18 Dixie, Grand Casino, Gulfport, MS .../ Line Item by Line Item: Income .../ State by State Market Share of 16-18 North Dakota, Gladstone Inn, Statements, Balance Sheets and Premiums Written & Losses Paid by Jamestown, ND Cash Flow with Percentages Direct, Affiliates and Agents .../ Compares: Direct with Affiliated 16-18 Wisconsin, Stone Harbor, Sturgeon .../ Family Detail: Parent Companies with Bay, W1 Agencies & Non-Affiliated Agencies Subsidiaries and Affiliates

17-19 Maryland, DC, VA, Cavalier Ho­ "The only source for~ information on title tel, Virginia Beach, VA insurance companies." 22-24 Nebraska, Mid Town Holiday Inn, Grand Isle, NE Call today (800) 296-1540 or e-mail to [email protected]

23-26 Washington, Coeur d'Alene, ID Please send me _ copies of the 1999 CDS Performance Of Title Insurance Companies. First copy: $275.00. Additional copies: $225.00. (1988 - 1998 Editions November available@ $150.00). Shipping and Handling: $10.00. MD residents add 5% Sales Tax. 10-13 Horida, Westshore Hotel, Tampa, FL Make checks payable to:

December Corporate Development Services, Inc. 2-3 Louisiana, Chateau Sonesta, New 174 Thomas Johnson Drive, Suite 201 Orleans, LA Frederick, MD 21702

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