No. 28507: R592-4. Standards for Charges for Title Escrow Settlement Services and Title Fees

DAR File No.: 28507
Filed: 05/15/2006, 02:35
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

As a result of the hearing and comments received during the first comment period, additional changes are being proposed.

 

Summary of the rule or change:

The title of the "Schedule of Escrow Charges" form is being changed to "Schedule of Minimum Charges for Escrow Services" to emphasize that these are minimum charges. It has also been determined that marketing information does not need to be filed with the department. As a result, all references to "marketing information" have been eliminated from the rule. The definition of "Other Settlement Services" is being re-defined, the definition of "Pass through fee" has been eliminated, and Section R592-4-6 is being eliminated. (DAR NOTE: This change in proposed rule has been filed to make additional changes to a proposed new rule that was published in the March 1, 2006, issue of the Utah State Bulletin, on page 38. Underlining in the rule below indicates text that has been added since the publication of the proposed rule mentioned above; strike-out indicates text that has been deleted. You must view the change in proposed rule and the proposed new rule together to understand all of the changes that will be enforceable should the agency make this rule effective.)

 

State statutory or constitutional authorization for this rule:

Section 31A-2-204

 

Anticipated cost or savings to:

the state budget:

The changes to this rule will reduce the work of the department's title specialists who will not be required to review and file marketing information filed by title agencies. The elimination of this filing will also save on storage for documents. These changes will not affect department revenues and budget.

 

local governments:

The changes to this rule will have no effect on local government since the changes deal only with the relationship between the department and their licensee.

 

other persons:

There will be no added expense to licensees or consumers as a result of the proposed changes. There will be a savings in time and postage in the elimination of the requirement for title agencies to file marketing information with the department. The change should not affect consumers at all.

 

Compliance costs for affected persons:

There will be no added expense to licensees or consumers as a result of the proposed changes. There will be a savings in time and postage in the elimination of the requirement for title agencies to file marketing information with the department. The change should not affect consumers at all.

 

Comments by the department head on the fiscal impact the rule may have on businesses:

The proposed changes to this rule will save title agencies time and postage. D. Kent Michie, Commissioner

 

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Insurance
Title and Escrow Commission
Room 3110 STATE OFFICE BLDG
450 N MAIN ST
SALT LAKE CITY UT 84114-1201

 

Direct questions regarding this rule to:

Jilene Whitby at the above address, by phone at 801-538-3803, by FAX at 801-538-3829, or by Internet E-mail at [e-mail]

 

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

07/03/2006

 

This rule may become effective on:

07/11/2006

 

Authorized by:

Jilene Whitby, Information Specialist

 

 

RULE TEXT

R592. Insurance, Title and Escrow Commission.

R592-4. Standards for Minimum Charges for [Title ]Escrow [Settlement ]Services[ and Title Fees].

R592-4-1. Authority.

This rule is promulgated by the Title and Escrow Commission pursuant to Section 31A-2-[204]404.

 

R592-4-2. Purpose and Scope.

(1) The purpose of this rule is to set forth standards for [creating the]minimum charges for [title ]escrow [settlement ]services [and title fees for pass through services and other services submitted ]on the Schedule of Minimum[Escrow] Charges for Escrow Services.

(2) This rule applies to all title insurers, agencies and producers providing escrow services in Utah.

 

R592-4-3. Definitions.

In addition to the definitions of Sections 31A-1-301, 31A-2-402 and 31A-19a-102, the following definitions shall apply for the purposes of this rule:

(1) "Additional escrow work" means escrow settlement services that are rendered in excess of the escrow settlement services not specifically shown in the minimum escrow charges listed in the Schedule of Minimum[Escrow] Charges for Escrow Services.

(2) "Charge" means a dollar amount charged for a service rendered by a title insurer, title agency, or title producer.

(3) "Document Preparation" means the preparation or compilation of documents in connection with escrow [settlement ]services.

(4) "Escrow charge" means a dollar amount charged for an escrow service shown in the Schedule of Minimum[Escrow] Charges for Escrow Services.

(5) "Schedule of Minimum[Escrow] Charges for Escrow Services " means the standardized form submitted with a title escrow charge filing.

(6) "Escrow [Settlement ]Services" means those services to settle real estate transactions.

(7) "Long-term Escrow" means For Benefit Of (FBO) accounts that are for the purpose of payment collection and administration of seller-financed transactions.

[(8) "Marketing Information Package" means an information package, a listing kit, a farm package or any other form of title evidence beyond that which is readily available in public records in the county in which the property is located.

(9)](8) "Mini Escrow" means an escrow settlement service done by a title agency to clear a title, obtain payoffs and record necessary closing documents for a lender that performs his or her own closing service.

(9) "Other Settlement Services" means additional services not specifically listed in the Schedule of Minimum Charges for Escrow Services.[(10) "Other Service Fee" means a fee for services performed or documents prepared that are neither a title insurance product nor an escrow settlement service.

(11) "Pass through fee" means a third-party fee incurred by the agency in connection with the settlement of real property transactions that are passed on to the appropriate principal party to the transaction.]

 

R592-4-4. Schedule of Minimum[Escrow] Charges for Escrow Services.

(1) The Schedule of Minimum[Escrow] Charges for Escrow Services must be used when submitting:

(a) an initial Schedule of Minimum[Escrow] Charges for Escrow Services filing; or

(b) changes to a previously submitted Schedule of Minimum[Escrow] Charges for Escrow Services filing.

(2) All blank fields of the Schedule of Minimum[Escrow] Charges for Escrow Services must be completed.

(3) If a filer does not perform a service, the blank field must show "N/A" or "Not Applicable."

 

R592-4-5. Charges.

(1) Escrow [settlement ]service charges.

(a) Escrow charge.

(i) In accordance with 31A-19a-209(3), no escrow charge may be filed or used that would cause the agency or producer to operate at less than the cost of doing the business of escrow.

(ii) Only minimum escrow charges shown in the Schedule of Minimum[Escrow] Charges for Escrow Services must be filed.[

(iii) Filed escrow charges are minimum charges.]

(b) [Additional escrow work charge]Other settlement services charge.

(i) An [additional escrow work]other settlement services charge will be used for [escrow charges]services not specifically shown in the Schedule of Minimum[Escrow] Charges for Escrow Services.

(ii) An [additional escrow work]other settlement service charge must be filed as a per hour charge.

(c) Document preparation charge.[

(i)] Only document charges shown in the Schedule of Minimum[Escrow] Charges for Escrow Services must be filed.

[(ii) The additional escrow work charge will be used for preparation of documents not specifically shown in the Schedule of Escrow Charges.

(2) Marketing information package.

(a) A marketing information package charge can be no less than the cost to produce one copy of the marketing information package.

(b) A marketing information package charge will be stated as a per copy charge.

(c) Each separate marketing information package must have its own charge.](2) Other services which are not specifically listed on the Schedule of Minimum Charges for Escrow Services may be rendered provided a justifiable charge is made.

 

[R592-4-6. Fees.

(1) Other service fee must be filed as a per hour fee.

(2) A pass through fee is:

(i) not filed; and

(ii) must be equal to the third-party fee for providing the service.

 

]R592-4-[7]6. Penalties.

A person found, after a hearing or other regulatory process, to be in violation of this rule shall be subject to penalties as provided under Section 31A-2-308.

 

R592-4-[8]7. Enforcement Date.

The commissioner will begin enforcing this rule 90 days from the rule's effective date.

 

R592-4-[9]8. Severability.

If any provision of this rule or the application of it to any person or circumstance is for any reason held to be invalid, the remaining provisions to other persons or circumstances shall not be affected.

 

KEY: title escrow charges

Date of Enactment or Last Substantive Amendment: 2006

Authorizing, and Implemented or Interpreted Law: 31A-2-204