ALTA Compliance Examination Procedure

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The Consumer Financial Protection Bureau determined that mortgage lenders are required to have effective internal control processes in place as they want to ensure that there are good controls over the confidential personal financial and identity information to which mortgage lenders are privy. Those lenders are now passing the responsibility for having good controls on to people they work with like law firms that close loans and work with title insurance companies. This is a way for the mortgage lenders to effectively manage the risks of their third-party service providers, including settlement attorneys and title agents.

In an effort to standardize the testing scope and criteria, the American Land Title Association stepped forward and developed an internal control framework known as the ALTA Best Practices.

This framework was an effort by ALTA to provide uniform procedures which could be utilized in determining that necessary policies and procedures have been appropriately implemented and meet or exceed minimal compliance expectations. Furthered by the arrival of the new combined disclosures for Truth in Lending and RESPA (commonly referred to as “TRID”), lenders have required compliance with federal consumer financial laws from the settlement attorneys and title agents with which they conduct business.

Many lenders have already sent letters to settlement attorneys and title agents, which require that these parties provide lenders with a completed self-attestation of compliance with the ALTA Best Practices. We have seen due dates from Summer 2015 to October 3, 2015.

While lenders are requesting self-certifications, some have further requested certification from an acceptable third-party verifying compliance with the Best Practices framework. Failing to do so, as stated by these lenders, could result in your removal from their approved listing of settlement attorneys that can close mortgage loans.

Hancock Askew has a team with the experience, knowledge and resources to perform this examination and provide you with a written assertion regarding your compliance with ALTA’s Best Practices. We have performed engagements with and issued reports already in 2015.

Our process starts with an introductory initial assessment where we see what assessment procedures you have in place and make recommendations to enhance what you have to be in compliance with the ALTA best practices. We will provide you with a list of the remediation steps necessary to achieve certification.

The second phase is for us to perform testing and, once best practices have been acceptably met, we will provide a report of procedures performed and a summary certification letter. We also will provide additional recommendations that will further improve your firm’s internal processes in accordance with the ALTA Best Practices.

About Hancock Askew:
Hancock Askew is a professional services firm tracing its origins back to 1910. The firm provides services that include audit, tax, accounting, internal controls and risk management, transaction advisory, business valuations, and other critical business consulting services. With offices in Savannah and Atlanta, Georgia and Miami, Florida, our staff of approximately 100 professionals provides support to an array of clients ranging from emerging businesses to large corporations, nonprofit organizations to publicly traded companies.

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