Title & Escrow Commission

Question:
I have a question about the rules changes that went into effect in June.

• [The previous version of the rule included, under permitted methods of competition, the ability to serve on a trade association committee and as an officer for the trade association.]
• R592-6-4(6) states: "Furnishing all or any part of the time or productive effort of any employee of the title producer to any client when such time is not related to a bona fide title insurance, escrow, settlement or closing transaction."

Does this mean as a title producer we CANNOT serve on the committees or hold leadership positions within trade associations, such as NWAOR.

Answer:
NWAOR the Northern Wasatch Association of Realtors is considered a trade association. Refer to R592-6-3(7): “Trade association” means a recognized association of persons, a majority of whom are clients or persons whose primary activity involves real property. Refer to R592-6-3(3)(c): “Client” does not include a trade association, for the purposes of this rule.

August 19, 2024 TEC meeting

Question:
I have been asked by a Photographer, who is a friend of mine, to participate in the same marketing is __________ doing.

The photography studio owner does hold a Utah Mortgage License, but this has nothing to do with their mortgage business. It’s photography only. There isn’t any discussion at the photo shoots of them being a mortgage loan officer nor do they solicit business. It’s strictly photography. The title agency does NOT collect or handle any money, nor do they sponsor anything. We act only as a mediator in encouraging people in our industry to step up their branding game. The title agency does not handle any scheduling and is just the one who makes this post on social media to get attention of these photo shoots. The photography owner handles the rest. The title agency/agent would direct all interested parties to the photography owner directly.

What’s in it for the title agency/agent, the title agency/agent would be allowed to attend the photo shoot and have the opportunity to get photos taken of them.

I don’t see an issue with it other than holding a mortgage license, but it’s not the entity of their business we would be involved with. __________ said they have not done a loan for over 6 months and does nothing with their license but does not want it to expire. Just photography. Please confirm if this is okay for us to do? I know of one other title company besides who is doing this same thing. So, I just want to get permission.

Answer:
First, a point of clarification the TEC is not giving permission. The TEC’s responses are advisory. They are not legal advice and are not binding on the TEC, the Department, or the insurance commissioner.

Subsection 12 of the rule (R592-6-4(12)) would appear to apply to the scenario described. In this instance, the conduct being contemplated, if action is taken, would be a violation of R592-6-4 as the title producer is writing/creating the post and the post is a thing of value that may constitute "paying for any advertising on behalf of a client." The photographer holds a current mortgage license and would be considered a "client" under the rule. Additional comments were made to clarify a title producer can repost something that was created by someone else. See R592-6-4-12(b)(ii).

August 19, 2024 TEC meeting

Question:
The inquiry is about a class entitled "Social Media Marketing," and it is "presented" by Title Agent X, owner of XXXX Title Insurance Agency, and Real Estate Agent Y, owner of YYYY Real Estate Photography. The class promises to teach agents how to use "phones to create reels and content, to market listings for sale and connecting with clients." The XXXX Title Agency logo appears along with the host's, YYYY Real Estate.

Under the new rules, "conducting education" that "does not address title, escrow, or a related subject" is prohibited. (R592-6-4 [18(a)].) A class on how to use cell phones for social media marketing does not appear "related" to title or escrow.

1. Is this class, or similar classes, compliant with the rule?
2. If it is not compliant, what steps may be taken to "officially" report XXXX Title Agency for "presenting" this class?

Answer:

1. R592-6-4(18) deals with "conducting education." Specifically, the rule prohibits a title producer from "conducting education that … does not address title insurance, escrow, or a related subject." See R592-6-4(18)(a). As presented, this "Social Media Marketing" class does not address title insurance, escrow, or a related subject and therefore would be a violation of the rule.
2. According to Bulletin 2024-11, a title licensee's complaint against another title licensee shall be submitted to the Insurance Department by filing a completed Title Licensee Complaint Form. The form can be found at https://insurance.utah.gov/forms-reports/#forms. The form must be completed in its entirety and must include documentation to support the complaint’s allegations. The form and supporting documentation shall be sent to title@utah.gov.

September 9, 2024 TEC meeting

Question:
It our understanding certain practices regarding distribution of self-promotional items are prohibited, however, we see one of these practices in particular, in our marketing area on a regular basis: Promo/swag items that not permanently marked or branded. There have been cases where we have seen holiday/seasonal swag items that are being given to real estate agents where only a business card has been stapled or taped to the item’s packaging.

Stapling or taping a business card to an item that is not branded with a title producers company name or logo company name is not allowed, is this correct?

Answer:
R592-6-4(16)(c) would apply in this circumstance. The rule prohibits the distribution to a client, consumer or member of the general public a self-promotional item that “does not contain a permanent marking identifying the title producer.” The stapling or taping of a business card to a self-promotional item lacks the intent of permanency required under Subsection 16(c). As presented, this conduct would be a violation of the rule.

September 9, 2024 TEC meeting

Question:
We understand there has been a title marketing rule that we cannot conduct a CE class more than once per calendar quarter, per physical location of a client. However, we need clarity on this rule for hosting a CE class at our title office:

R592-6-4(18) Conducting education that:
(a) does not address title insurance, escrow, or a related subject;
(b) involves expenditure of more than $20 per anticipated person including the
cost of meals and refreshments;
(c) involves expenditure of more than $500 for a facility and instructor; or
(d) is conducted at an individual, physical office location of a client more than
once per calendar quarter

An example:

• XXXX Title Agency teaches a CE class at XXXX Title Agency in July
• ABC Lender teaches a CE class at XXXX Title Agency in August
• 123 Vendor teaches a CE class at XXXX Title Agency in September

Would this be allowed? Three or even more CE classes hosted by XXXX Title Agency at XXXX Title Agency in a calendar quarter?

Answer:
R592-6-4(18)(d) prohibits a title producer from conducting education that “is conducted at an individual, physical office location of a client more than once per calendar quarter.” A title producer is not a “client” under the definitions of the rule. Therefore, as presented, hosting multiple education classes at the title producer’s location would not be a violation of the rule.

September 9, 2024 TEC meeting

Question:
Is an agency required to charge for continuing education that clients attend and where the courses are hosted at the agency facility or a client's facility?

Answer:
R592-6-4(18) prohibits a title producer from:

(18) Conducting education that:
(a) does not address title insurance, escrow, or a related subject;
(b) involves expenditure of more than $20 per anticipated person including the cost of meals and refreshments;
(c) involves expenditure of more than $500 for a facility and instructor; or
(d) is conducted at an individual, physical office location of a client more than once per calendar quarter. 

As the question has been presented, R592-6 does not require a title producer to charge for attending or participating in "education" that the title producer conducts. The title producer is otherwise expected to act in compliance with all the provisions of R592-6-4(18) for conducting education.

October 21, 2024 TEC meeting

Question:
Is it a violation of the rule if a continuing education course has been approved by the Utah Division of Real Estate but "does not address title insurance, escrow or a related subject"?

Answer:
R592-6-4(18) prohibits a title producer from:

(18) Conducting education that:
(a) does not address title insurance, escrow, or a related subject;
(b) involves expenditure of more than $20 per anticipated person including the
cost of meals and refreshments;
(c) involves expenditure of more than $500 for a facility and instructor; or
(d) is conducted at an individual, physical office location of a client more than
once per calendar quarter.

As the question has been presented, R592-6-4(18) does not expressly exempt continuing education courses approved by the Utah Division of Real Estate from the scope of the rule. A continuing education course must be compliant with R592-6-4(18), including but not limited to the subject matter of the course. Though not defined in the rule, "a related subject" under R592-6-4(18) are those subjects directly connected with the provision of title insurance and/or escrow services.

November 25, 2024 TEC Meeting

Question:
Is it a violation of the rule if a title producer furnishes or provides information that may be considered "a farming tool"?

Answer:
R592-6-4(11) prohibits a title producer from furnishing or providing the following, even for a cost:

(a) building plans;
(b) construction critical path timelines;
(c) "For Sale by Owner" lists;
(d) surveys;
(e) appraisals;
(f) credit reports;
(g) mortgage leads for loans;
(h) rental or apartment lists; or
(i) printed labels.

As the question has been presented, so long as a title producer's "farming tools" do not consist of the prohibited documentation or information expressly stated under R592-6-4(11), there would be no violation of the rule. For information only, the previous version of the rule did prohibit the providing of access to certain types of information and documentation.

November 25, 2024 TEC meeting

Question:
May a title producer contribute food or provide sponsorships at an event hosted by a "trade association"?

Answer:
Under R592-6-3(7), "trade association" means a recognized association of persons, a majority of whom are clients or persons whose primary activity involves real property.

Under R592-6-3(3)(c), "client" does not include a trade association, for the purposes of this Rule.

If the event is, in fact, hosted by a "trade association" as defined in the rule, the prohibition only applies when "[s]ponsoring a trade association event at a cost that is greater than the sponsorships offered to members of the association, affiliates, vendors or other participants of the event." See R592-6-4(10). A title producer may contribute food or give sponsorships at a trade association event if the cost is not greater than the sponsorships offered to members of the association, affiliates, vendors or other participants of the event.

November 25, 2024 TEC meeting

Question:
May a title producer provide food around a trade association event without providing education?

Answer:
Under R592-6-3(7), “Trade association” means a recognized association of persons, a majority of whom are clients or persons whose primary activity involves real property.

Under R592-6-3(3)(c), “Client” does not include a trade association, for the purposes of this rule.

If the event is, in fact, hosted by a “trade association” as defined in the rule, the prohibition only applies when “[s]ponsoring a trade association event at a cost that is greater than the sponsorships offered to members of the association, affiliates, vendors or other participants of the event.” See R592-6-4(10). A title producer may provide food or sponsorships at a trade association event if the cost is not greater than the sponsorships offered to members of the association, affiliates, vendors or other participants of the event.

November 25, 2024 TEC meeting