Besides seasonal slow down during holidays, there is another factor that will impact the title industry. Its a new law (going in effect on 01/14/2014) that all lenders, servicers, trustees and title companies would have to comply with.
The CFPB amended Regulation Z, which implements the Truth in Lending Act (TILA). Regulation Z currently prohibits a creditor from making a higher-priced mortgage loan without regard to the consumer’s ability to repay the loan. The final rule implements sections 1411 and 1412 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), which generally require creditors to make a reasonable, good faith determination of a consumer’s ability to repay any consumer credit transaction secured by a dwelling (excluding an open-end credit plan, timeshare plan, reverse mortgage, or temporary loan) and establishes certain protections from liability under this requirement for “qualified mortgages.” The final rule also implements section 1414 of the Dodd-Frank Act, which limits prepayment penalties. Finally, the final rule requires creditors to retain evidence of compliance with the rule for three years after a covered loan is consummated.
... a few words on regulation document.....What's interesting is that CFPB does not call for a title search as a tool to determine the debt of the borrower from the third party vendors, such as title companies, however I still believe that Title Search is most accurate and reliable tool to be used as a qualifier for a borrower. In my opinion, title abstractors will not see new requests on refis until many changes are implemented in the title industry for compliance to this rule. For example, new underwriting guidelines have to be put in place to qualify the borrower, new documents have to be generated for closing, new flows have to be considered as exit strategies by lenders, as the pre-payments on the loans are trimmed, Foreclosing attorneys have to rework their templates for Qualified Mortgage foreclosures, just to name a few changes....The main change would be a burden to the borrower to produce many documents per regulation to qualify for a loan and prove 43% debt to income ratio.
Title companies, attorneys, lenders had a year to prepare for a new regulation. I doubt that the many firms actually became compliant and have to hold or delay the business until the complete compliance is established.