The New York Times - Title Insurance Reform

Op-Ed

"The Title Insurance Scam" (editorial, May 12) displays the reality of the reverse competition in the title insurance market. Constituents from my district have told me that home buyers are steered by people they trust -- realtors, lenders, mortgage brokers, homebuilders -- to buy title insurance without realizing that the referring agent may own a share of the title insurance firm.

Congress could easily remove the incentive for self-dealing by passing my bill, the Ensure Fair Prices in Title Insurance Act (H.R. 1799). This bill simply prohibits a financial benefit for any referral. Realtors and lenders can still have affiliations with title insurance companies. They can even own them, but they cannot receive a financial benefit for the referral.

The bill improves the markets for home buyers -- no referral fee baked into overpriced title insurance; and it is better for the title insurance firms -- no need to share your profits with a referral agent to find clients.

Gov. Andrew M. Cuomo of New York; the state's superintendent of financial services, Benjamin M. Lawsky; and Richard Cordray, the director of the Consumer Financial Protection Bureau, should be commended for taking on the realty industry. I hope that the momentum started in New York will encourage Congress to pass H.R. 1799 this year.

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