Title insurer tightens reins on lenders
The country’s largest title insurer said that banks and other lenders must vouch for the accuracy of their mortgage documents before the firm will write insurance for a foreclosure sale.
Fidelity National Financial announced the policy change — the strongest move yet by a title insurer to protect itself from possible losses — in a memo this week to its employees and agents, according to Peter Sadowski, the company’s chief legal officer.
Recent reports of flawed paperwork have particularly worried title insurance companies, which are critical in the home-buying process. Lenders require buyers to buy coverage in case there is a dispute over who owns a home.