ALTA Meets With Federal Reserve Staff. National Lien Registry Not Intended to Replace Local Recording (from ALTA Advocacy Update – 1/30/12)

ALTA Meets  With Federal Reserve Staff. National Lien Registry Not Intended to Replace  Local Recording   On Wednesday,  ALTA met with staff in the Federal Reserve Board’s Division of Consumer and  Community Affairs to clarify the January 4, 2012, white paper, entitled  “The U.S. Housing Market: Current Conditions and Policy  Considerations.” Included in this housing white paper were two paragraphs  that suggested a national lien registry be created. There was little  explanation of the concept, what a national registry would do, who would use it  or for what purposes.   During the meeting, ALTA explained how the lack  of details in the white paper led the industry to believe that the Fed was  calling for an end to the recording of property interests in local public  records in accordance with state law. Federal Reserve staff quickly said that  was not the intent and explained that their suggestion was meant to foster  discussion about how to make information contained in local recording systems  more user-friendly to consumers and policymakers.   Fed staff explained that the “registry” would not  be used to replace state law requirements for perfecting Liens through  recording in local public records. Rather, it would connect locally recorded  documents with real time information about the mortgage loan, including the  outstanding loan balance, whether there are any second mortgages or HELOCs  outstanding against the collateral, as well as contact information for the current  servicer and noteholder. While there are no plans for the Fed or anyone else to  develop and institute this system, the Fed envisions it being a public utility  open to regulators, consumers and lenders.  The clarification was helpful, but we expect this  to be the first in a series of meetings with interested stakeholders. Please  reach out to me if you would like to learn more about the meeting and the Fed’s  white paper at justin@alta.org.

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