House Study Bill 553 



                                       SENATE/HOUSE FILE       
                                       BY  (PROPOSED IOWA FINANCE
                                            AUTHORITY BILL)


    Passed Senate, Date               Passed House,  Date             
    Vote:  Ayes        Nays           Vote:  Ayes        Nays         
                 Approved                            

                                      A BILL FOR

  1 An Act relating to coverage of closing protection letters in real
  2    estate transactions and providing an effective date.
  3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
  4 TLSB 5295XD 82
  5 md/rj/8

PAG LIN



  1  1    Section 1.  Section 16.93, subsection 1, Code 2007, is
  1  2 amended to read as follows:
  1  3    1.  The authority through the title guaranty division may
  1  4 issue a closing protection letter to a person to whom a
  1  5 proposed title guaranty is to be issued, upon the request of
  1  6 the person, if the division issues a commitment for title
  1  7 guaranty or title guaranty certificate.  The closing
  1  8 protection letter shall conform to the terms of coverage and
  1  9 form of the instrument as approved by the division board and
  1 10 may indemnify a person to whom a proposed title guaranty is to
  1 11 be issued against loss of settlement funds due to only the
  1 12 following acts of the division's named participating attorney,
  1 13 or participating abstractor, or closer:
  1 14    a.  Theft of settlement funds.
  1 15    b.  Failure by the participating attorney, or participating
  1 16 abstractor, or closer to comply with written closing
  1 17 instructions of the person to whom a proposed title guaranty
  1 18 is to be issued relating to title certificate coverage when
  1 19 agreed to by the participating attorney, or participating
  1 20 abstractor, or closer.
  1 21    Sec. 2.  EFFECTIVE DATE.  This Act, being deemed of
  1 22 immediate importance, takes effect upon enactment.
  1 23                           EXPLANATION
  1 24    Under the title guaranty program, the Iowa finance
  1 25 authority through the title guaranty division may issue a
  1 26 closing protection letter that conforms to the terms of
  1 27 coverage and form of the instrument and may indemnify a person
  1 28 to whom a proposed title guaranty is to be issued.  A closing
  1 29 protection letter protects against loss of settlement funds
  1 30 due to the acts of the division's named participating attorney
  1 31 or participating abstractor.  This bill adds "closer" to the
  1 32 list of participants whose acts may be covered by a closing
  1 33 protection letter in real estate transactions.
  1 34    The bill takes effect upon enactment.
  1 35 LSB 5295XD 82
  2  1 md/rj/8