No. 29995: R592-6. Split Closing in Title Insurance

DAR File No.: 29995
Filed: 07/30/2007, 01:14
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

Due to changes proposed in the rule hearing and during the comment period, this change in proposed rule filing is being made.

Summary of the rule or change:

In Subsection R592-6-3(1)(b), the word "acceptance" is replaced with "receipt." Under the definition of "Split Closing", Subsections R592-6-3(2)(b) and (c) are eliminated which refer to two separate people providing the title insurance and conducting the real estate closing in two separate locations. Subsections R592-6-4(3)(b)(i) and (ii) are switched. In each the words "monies collected" are replaced with "monies received." The reference to "depositing" monies received via a wire transfer has been 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 June 15, 2007, issue of the Utah State Bulletin, on page 39. 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-2-404

Anticipated cost or savings to:

the state budget:

The changes to this rule will have no fiscal impact on the state's budget. The department's revenues will not change and the workload of our personnel will not be affected.

local governments:

Since this rule deals with the relationship between the department and their licensees, it will have no impact on local government.

small businesses and persons other than businesses:

There is only a minor increase in cost if the licensee chooses to do a split closing. The additional cost will come in the additional form the title agency will need to complete and retain and the time it will take to complete the form.

Compliance costs for affected persons:

There is only a minor increase in cost if the licensee chooses to do a split closing. The additional cost will come in the additional form the title agency will need to complete and retain and the time it will take to complete the form. There could be a minor fiscal impact to the consumer involved in a split closing if the costs are passed on to him or her.

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

The changes to this rule will result in a very minor fiscal impact to the title agent involved in a split closing. 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:

09/14/2007

This rule may become effective on:

09/21/2007

Authorized by:

Jilene Whitby, Information Specialist

RULE TEXT

R592. Insurance, Title and Escrow Commission.

R592-6. Split Closings in Title Insurance.

 

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R592-6-3. Definitions.

For the purposes of this rule, the commissioner adopts the definitions in Sections 31A-1-301, 31A-2-402, and the following:

(1) "Courtesy closing" means:

(a) the signing of settlement documents for a real estate transaction; or

(b) the [acceptance]receipt of monies for forwarding to the person conducting the escrow services to complete the real estate purchase.

(2) "Split closing" means a real estate transaction closing conducted[:

(a) ] by two different persons providing a title insurance product[; or].

[(b) one person providing a title insurance product and one person conducting a courtesy closing as defined herein; and

(c) in two separate locations.

](3) "Split Closing Instruction form" means the Split Closing Instruction form established by the Title and Escrow Commission and available at the department.

(4) "Title insurance product" means the insuring, guaranteeing, or indemnifying of owners of real or personal property or the holders of liens or encumbrances on that property, or others interested in the property against loss or damage suffered by reason of liens or encumbrances upon, defects in, or the unmarketability of the title to the property, or invalidity or unenforceability of any liens or encumbrances on the property.

(5) "Title insurance service" has the same meaning as the definition of "escrow" found in Subsection 31A-1-301.

 

R592-6-4. Split Closing Requirements, Processes and Procedures.

(1) A split closing may be conducted if:

(a) requested by the buyer, seller, or lender or an agent for the buyer, seller, or lender; and

(b) a Split Closing Instruction form is completed and executed by the buyer, seller, and persons conducting the split closing not later than the date of closing.

(2) Only persons issuing a title policy may:

(a) provide a title insurance service; and

(b) receive, deposit, and disburse monies.

(3) A person conducting a courtesy closing:

(a) may have real estate settlement documents signed; and

(b) may accept monies for forwarding to the person conducting the escrow services to complete the real estate purchase;

(i) [monies collected via wire transfer may be deposited and must be forwarded within one business day of receipt; or

(ii) ]monies [collected]received via any [other ]method other than[except] wire transfer may not be deposited and must be forwarded when the signed real estate documents are forwarded[.]; or

(ii) monies received via wire transfer must be forwarded within one business day of receipt.

 

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KEY: title split closings

Date of Enactment or Last Substantive Amendment: 2007

Authorizing, and Implemented or Interpreted Law: 31A-2-404