Sunday, March 11, 2007

query: subprime problems affect title companies

You betcha. Title insurance underwriters and agents who made a market serving the subprime lenders will most definitely be affected. The loss of volume alone will be tough but look for the more interesting development. Watch to see who get taken out for fraud. Much of the subprime collapse is linked to fraudulent transactions. As the FBI unravels the subprime fraud tapestry look for title insurers who colluded and enabled fraud to get nailed right along with consumers and lenders.

One of the primary functions of a professional, honest title insurer and closer is the guardianship of fidelity. This function has been devalued over recent years much to the detriment of the real estate world. I look for and am hoping for a resurgence in quality.

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