Last year, a senior vice president at First American made the following claim:

In my opinion, during the boom years leading up to the real estate crash, government regulators, lending institutions, appraisers and ratings agencies, loosened their risk management criteria or relaxed their standards of ethical business conduct. The title insurance industry did not.

And here I was all excited because I thought there was GUARANTEED big news to write about today.

Well, so much for the notion that our little industry might make headlines for once.  The Supreme Court did not reach a decision in the RESPA Section 8 class action case First American v. Edwards.  The "decision" consisted of nine words: "The writ of certiorari is dismissed as improvidently granted."

This week, title insurance rating agency Demotech published a study, "Escrow Theft: Today's Challenge in Title Insurance", in which Demotech compares title insurance claims ratios for each state from 2004 to 2011 to its own ranking of the strength of each state's title agent regulations.  From that data Demotech concludes that states with stronger title agent regulation have lower rates of escrow theft. 

Unfortunately, the study falls well short of actually showing any link between title agent regulations and lower losses due to escrow theft.

When your cable goes out*, you start a title agency.

in early 2001, Lisa Rotolo got her title agent's license and opened her own firm.

When you start a title agency, you help close shady deals for free.

[Rotolo], the title agent key to Southwest Florida's expansive flipping fraud scheme acknowledged Monday that she helped close millions of dollars in fraudulent deals, though unlike others in the conspiracy only for her standard fees.

Disclaimer: The actual final language in the national mortgage settlement is not yet available, so the details in this agreement are yet unknown. The devil, as they say, is often in the details. What information is available comes largely from summaries of the settlement published by the Administration, and as the Administration has a motive to make the deal sound as tough as possible, these summaries have to be viewed with a little bit of skepticism. I tried to read the available information from that skeptical perspective.

With that out of the way, here are my initial thoughts on the national mortgage settlement announced yesterday:

In late December, my brother and I bought a house to fix up and "flip" on the north side of Columbus, Ohio. This is the house: