BRIGHT TITLE & TRUST LLC BEST PRACTICES MANUAL

Transcription

1 BRIGHT TITLE & TRUST LLC BEST PRACTICES MANUAL One Branch only located at: 1095 W. Morse Blvd Suite 202 Winter Park, FL Owners: Operations - Kirsten Hendricks Outside/Silent Owners - Tyler Piercy George Zaczac Employees: Linda Phillips We are a new small start-up located in a small office space in a secure building. Kirsten and Linda work at the office and are responsible for all daily activities and operations.

2 BEST PRACTICE SECTION 1 LICENSING Establish and maintain all licenses required to conduct business in the Florida title insurance industry. Florida Department of Financial Services License Number W Fidelity National Title Insurance Company Agent ID Number FL 8294 State Statute Requirements Section (1), Florida Statutes, defines a TITLE INSURANCE AGENT as a person, appointed in writing by a title insurer for the purpose of issuing and countersigning binders, commitments, policies of title insurance, or guarantees of title in its behalf. Chapter 626, Part V: Title Insurance Agents (Sections ) Chapter 627; Part XIII: Title Insurance Contracts (Sections ) Procedures: 1. All licenses for individuals and the agency and all related costs will be kept up the date on an annual basis. 2. All licenses shall be tracked using a licensing log. The log shall include Employee Name, License Number, License Expiration Date, License Continued Education Requirements, License C.E. Credits completed, License C.E. Credits still needed. 3. All updated information/logs shall be kept in the Best Practices Section 1 Folder. 4. Kirsten Hendricks will be responsible for keeping and updating the information.

3 Licenses: Florida Title License: 1. Kirsten Hendricks is an owner and the only licensed Florida Title Agent. 2. Kirsten Hendricks is responsible for all activities requiring the Florida Title License including but not limited to, examining title reports, signing title commitments, signing title policies and overseeing daily operations. 3. Professional designations are advertised on the company website. 4. Back up license for Kirsten Hendricks if she is unable to be working in the office due to illness, vacation etc., is attorney Michael S. Grimsley, Esquire, Florida Bar License number Michael S. Grimsley does not hold any ownership in the agency and has agreed to assist with this necessity since the agency is so small and needs to have a backup plan in case Kirsten is incapacitated for any reason. Michael Grimsley shall be compensated by an agreement between Kirsten Hendricks and Michael Grimsley each time his services are required. He has been chosen for this role because of his long standing relationship with Kirsten Hendricks. They have worked together for many years and he was previously a shareholder at the law firm where Kirsten Hendricks was employed prior to opening this agency. Florida Registered Paralegal: 1. Linda Phillips is the only employee currently with the agency and she is a Florida Registered Paralegal. Her License Number is ALTA Policy Forms Licensing: 1. The agency is a member of ALTA. 2. The Policy Forms license is included in our membership. 3. Kirsten Hendricks shall be responsible for continuing the membership and paying annual membership dues.

4 BEST PRACTICES SECTION 2 ESCROW ACCOUNT CONTROLS Maintain appropriate written procedures and controls for Escrow Trust Accounts allowing for electronic verification of reconciliation. Procedures: Escrow Trust Account is with Florida Community Bank and meets the requirements of Florida Statutes Section (3) and is identified as an Escrow Account on checks, deposit tickets, bank statements or agreements. Current Escrow Trust Account: Florida Community Bank Account #: ending 3800 BTT has one Escrow Trust Account. Authorized Signers: Kirsten Hendricks Owner/Manager Tyler Piercy Owner/Manager Linda Phillips Employee (Tyler does not contribute to the daily operations and is only a signer for emergency purposes since he and another person have ownership in the agency. However, he is available as a back-up for operations if the need should arise). BTT also has two (2) operating accounts: Florida Community Bank Account #s: ending in 1000 (Recording/Simplifile) and 1500 (BTT Operating Funds)

5 Reconciliations: 1. Three way reconciliation of Escrow Trust Account to be performed by Closers Choice and submitted to Underwriter on a monthly basis. 2. Kirsten Hendricks shall be responsible for providing the bank statements to Closers Choice each month within 3 business days of receipt. 3. Kirsten Hendricks shall be responsible for reviewing and approving the reconciliations performed by Closers Choice. 4. Issues, problems, errors and/or shortages identified by the reconciliation shall be the responsibility of Kirsten Hendricks. 5. Kirsten Hendricks will address those items of concern from above within 1 week and resolve within 2 weeks unless there is a delay caused by something outside of her control. In that case it will be completed as soon as possible. 6. Immediate action shall be taken to fund shortages. 7. Positive pay with the escrow account shall be utilized if necessary. 8. Recordings handled by Simplifile will be funded by E-Check from funds transferred from Escrow Account to by separate Operating Account. FCB Account #: ending Deposits are made daily either by bank run or remote deposit system 10. Kirsten Hendricks and Linda Phillips both have access to all bank accounts and wire abilities and will be the only people with these permissions. 11. Kirsten and Linda back each other up if one is out. Tyler Piercy can be an extra back up, if necessary. 12. In the future, if BTT growth requires any more employees to have banking permissions to ensure the continued flow of business as usual, it will be evaluated at that time and the policy may be revised to accommodate the need. 13. Future employees who receive banking permissions must submit to a background and credit check covering the prior seven (7) years. 14. Future employees shall receive training in the management of escrow funds and escrow accounting. 15. Training performed and attendance shall be monitored using a log. 16. All Escrow deposit checks shall be deposited into the escrow Trust Account with 2 business days of receipt.

6 17. Escrow deposit checks shall be locked up in assigned drawer in Kirsten s desk until deposited. 18. If escrow deposit checks are deposited using the remote deposit system, the original checks will be destroyed using shredding company, Crown Shredding. 19. Deposits can be handled by either Kirsten Hendricks or Linda Phillips. Kirsten is responsible for making sure all deposits are handled appropriately and in a timely manner. 20. Wires can be performed by Kirsten Hendricks or Linda Phillips using online banking and a secure token specifically assigned to each of them. 21. Wires are received and sent from the same account. 22. ACH Blocks have been set on the Escrow Account. 23. Any employee who is terminated or resigns will be blocked from the bank accounts and wire abilities immediately by contacting our bank representative and providing the documentation to revise signatories. 24. All disbursements are kept in the file for auditing and purposes. 25. Kirsten Hendricks will do final audits of all files on a monthly basis. Dormant Funds Policy BTT will do everything possible to contact the consumer concerning funds that have been held in the Escrow Trust Account for longer than five (5) years in accordance with Florida Disposition of Unclaimed Property Act (Chapter 717, F.S.) Reporting and remitting to: Agency Support Department Interest Bearing Account Policy on any BTT Escrow Trust Account provided to the consumer on a written disclosure provided and signed by consumer at closing. Disbursements of Proceeds: 1. All funds received by BTT for amount due on line 303 of the HUD-1 Settlement Statement must come into our escrow account from the buyer. Any other funds received from other parties will be reflected in the 200 series and designate the source of the funds.

7 2. Any payments made from the seller s proceeds must be reflected in the 1300 series and be approved by the funding lender. 3. Any refinance disbursements shall be made in accordance with the lender s closing instructions. 4. Any disbursements made on behalf of the seller, lender or borrower shall require written instructions to be kept in the file. 5. Escrow disbursements are handled by Kirsten Hendricks and Linda Phillips. Since they are the only people working at BTT there is not a requirement for 2 approvers of wires or check disbursements. 6. No cashier s checks will be accepted as closing funds from any party to the transaction. 7. Any checks issued from BTT Escrow Trust Account that are lost or stolen will require a stop payment. Kirsten or Linda will contact the bank to verify the check has not cleared our account and then will issue the stop payment. No replacement check can be issued until 24 hours after the stop payment has been done by the bank. 8. Since there are only 2 people working at BTT, Kirsten Hendricks and Linda Phillips shall both be authorized to send wires via online banking or at the bank branch. 9. All wires are sent using a secure token - 2 have been issued by the bank to Kirsten Hendricks and Linda Philips, respectively. 10. Copies of all incoming and outgoing wires shall be kept in the file. 11. Copies of all deposits shall be kept in the file. 12. Copies of all checks including voided shall be kept in the file. 13. Final check register / disbursement log shall be kept in the file. 14. No disbursements shall be made that do not conform to the lender s closing instructions. 15. Signature stamps shall not be used on escrow checks. 16. Outstanding checks issued for payoffs, recording or other lienable events will be investigated if they have not cleared within three (3) days. 17. Any other outstanding checks will be investigated after thirty (30) days. 18. Signed escrow agreements shall be kept in file for any funds held in escrow after closing for any reason.

8 BEST PRACTICE - SECTION 3 INFORMATION AND DATA PRIVACY Written privacy and information security program to protect Non-Public Information as required by local, state and federal law. The Federal Trade Commission defines NPI as: any information an individual gives you to get a financial product or service (for example, name, address, income, Social Security number, or other information on an application); any information you get about an individual from a transaction involving your financial product(s) or service(s) (for example, the fact that an individual is your consumer or customer, account numbers, payment history, loan or deposit balances, and credit or debit card purchases); any information you get about an individual in connection with providing a financial product or service (for example, information from court records or from a consumer report). Examples of NPI include: Bank loan payoff and credit card statements; Insurance retirement and tax information; Social Security numbers and dates of birth; and Real estate/title related items, commission amounts and loan fees. There are many sources within a company where NPI can be found, such as: physical locations such as paper-based files, desktop or reception area, the closing table and warehouse. With the widespread use of smart phones, BTT is vigilant in the protection of NPI on documents visible to anyone other than vetted employees, such as at the closing table.

9 There are also many electronic locations where NPI is housed. These include: Computers Network servers servers Instant messaging servers Fax servers Copy machines with internal hard drives Smart printers with internal hard drives or network storage devices Web servers Cloud storage (e.g., Google, Dropbox) Backup tapes; online backup services User-provided devices/media (e.g., Employee smart phones, Tablets, USB storage devices) Additionally, NPI can be in the possession of vendors a company may utilize. These include: Mobile notaries Mobile closers Couriers Online backup Services or off-site backup tape storage vendors service providers Server and website hosts BTT shall take reasonable steps to select and retain service providers that are capable of appropriately safeguarding NPI.

10 Policies to protect NPI: Physical security of Non-public Personal Information (NPI) both hard copy and digitally stored information: Only employees that have undergone a background check shall have access NPI The NPI is protected by the door to the conference room which blocks access to Kirsten and Linda s office which contains almost all of the NPI, the receptionist area is also protected by a door and the NPI that is kept in the receptionist area which is a room with a door off of the entrance lobby and is kept using the Clean Desk policy. The closing/conference room only has access to the lobby and no other areas of the office. File cabinets are locked when not in use or when no one is present. Office has a Clean Desk Policy. Access to areas containing NPI for external cleaning services, repair technicians, vendors that deliver supplies, services that provide file storage or shredding services, Realtors and other third parties is blocked by controls including but not limited to, NPI is locked up or if temporary movement through an area containing NPI is required it will also require being accompanied by BTT personnel. Secure delivery methods in place: o Hard Copy /Paper delivery by mail to address on file or requested by the party. o Use of encrypted for electronic transmissions when sending NPI. Record Retention & Record Disposal Policy All physical files will be kept locked in cabinets while in the office, after file is completed it will be scanned and saved to a secure location before being destroyed and disposed of by an approved shredding company vendor. Privacy & Information Security Plan Miscellaneous controls set up by IT to ensure NPI is protected. Cyber Insurance coverage as a back-up.

11 Clean Desk Policy All items on desk containing NPI will be locked away when personnel are not at their desk. Only items being currently worked on will be on the desk while personnel are at their desk. BTT staff shall cover or lock up NPI if they receive a visitor to their desk or desk area/office. Physical Security Building is secure with key access only. All visitors to the building must be given access by calling on outside box so we can buzz them into the building. Computer system server is securely isolated in Kirsten s office but will be moved to a locked IT closet once the landlord has the IT closet completed. Server back-up is securely located offsite to a cloud and also to a hard drive that only Kirsten has access to. In the future if BTT hires any employees whose job functions do not require access to NPI, their access will be limited or disabled on all company computers where the employees so that an employee or someone else would not be able to upload or download data using a portable memory device (USB, jump/thumb drive, external hard drive, phones, etc.). BTT will properly dispose of paper records and electronic records, including those contained on hard drives of smart copiers/printers, as established under the Federal Trade Commission (FTC) Disposal Rule. Necessary due diligence on a 3rd party provider vendor for destruction of records will be performed and BTT will maintain receipts from the disposal company for audit purposes. 3 rd Party vendor used by BTT for this purpose is Crown Shredding. Cyber Insurance covers notification to consumers of any data security breach. Cyber Insurance covers credit monitoring for period of one (1) year from breach. Kirsten Hendricks will be responsible for notifying law enforcement of a data security breach as required by law. BTT Privacy Statement will be provided to customers/consumers as required by law. BTT Privacy Statement will be on BTT website. NPI Information Statement will be provided separately describing how BTT obtains NPI through the closing process.

12 NPI Information Statement separately describing how BTT obtains NPI through the closing process will be posted on the website. Employee Training: All BTT policies and procedures will be communicated and training will be provided to new hires. All employees will receive continued training on the BTT adopted policies to help ensure compliance with the company s Information Security Plan and any other written policies/procedures. Management will have monthly meetings with employees to do updated training or ongoing review of policies and procedures already in place. Employees must acknowledge by signature that they have reviewed and will abide by the BTT established policies. Kirsten Hendricks will perform an internal audit to ensure ongoing compliance and employee training with the company s Information Security Policy and other Data Security Policies and will consult with IT on a regular basis to ensure policies in place are current and as up to date as necessary. Employee training will include directions not to insert any unknown device into company systems (i.e. found a thumb drive in the parking lot). Ongoing employee training or notifications to employees will be provided on current types of cyber threats (i.e. phishing, etc.) Third Party Vendors: Policy to vet 3rd Party Vendors who have not been endorsed by ALTA or our Title Underwriter will be required to acknowledge by signature the BTT Information Security Plan using a Compliance Notice provided by BTT.

13 Business Continuity Plan will be utilized for any incident affecting operations of the company. Annual Testing of NPI Procedures: Contracted IT service provider will conduct system testing for external infiltration to ensure BTT system cannot be hacked. BTT will retain documentation each time the hack test is completed. IT Services provided by contracted signed agreement between Bright Title & Trust LLC and Webcom IT Solutions, Inc. James Hunt MCSE, BS-IST Microsoft Partner Intel Channel Partner Orlando Miami Cell North Semoran Blvd. Suite 106, Orlando, FL

14 BEST PRACTICE - SECTION 4 SETTLEMENT POLICIES AND PROCEDURES Our policies for conducting ongoing employee training and oversight to ensure that Bright Title & Trust LLC ( BTT ) meets state, federal and contractual obligations governing the settlement process and provide a safe and compliant settlement. Pricing Procedure: BTT will use the current rates and remittances for rates and split calculations, policy issuance and policy reporting If rate change bulletins are issued BTT will review and revise immediately to ensure proper rate changes are made A calculation remittance worksheet will be generated from closing software and will be provided to the underwriter with the remittance and also kept in the file for each transaction Applicable rate discounts will be applied to each transaction provided the necessary documentation is obtained when appropriate such as having a copy of the prior policy if a re-issue credit is given at closing Kirsten Hendricks will work closely with the software provider to ensure the remittance calculations worksheet prepared in the software are in compliance with current rates and remittances Recording Procedure: Documents are submitted or sent out to recording using local courier or a shipping service within 2 business days of the later of (i) the closing/funding date, or (ii) receipt by BTT of the documents if the closing is not performed by BTT BTT will use electronic recording when available and appropriate Shipments of documents will be tracked If recording documents are rejected, they will be corrected and resubmitted to the recording office within 2 business days

15 Disbursement Procedure: We acknowledge that Lenders expect full disclosure of all receipts and disbursements in accordance with written mutual instructions. All sets of Closing Instructions are collected and reviewed prior to closing. If any one set of Closing Instructions is adverse to another set of closing instructions we obtain in writing from the lender consent to the changes made to correct the adverse matters prior to closing. The closing is performed in accordance with all instructions including: a) Lender Closing Instructions b) Title Commitment c) Purchase Agreement d) Any other misc. agreements (Escrow Agreements, etc.) Follow all HUD Regulations in preparation of the HUD-1 Settlement Statement and be sure that the disbursements match as to what is shown on the HUD-1 Settlement Statement. BTT will adhere to all State and Federal laws. Specific Detailed Guidelines: Disbursement of Proceeds Buyer/Borrower Proceeds Any amount shown on line 303 of the HUD-1 Settlement Statement (funds due from Buyer/Borrower) must come into the escrow/trust account from the borrower or be disbursed to the borrower as shown in Section D. Any funds received by any other party will be reflected on a separate line in the 200 series designating the source of funds.

16 Seller Proceeds Seller proceeds are not assigned and are disbursed to Seller, as defined in the Loan Closing instructions and in accordance with the HUD-1 settlement statement. When the Seller requests the proceeds be paid otherwise, appropriate documentation will be obtained or a clearance will be obtained from Underwriter Multiple disbursements to the same payee are not acceptable especially when asked to disburse in increments of $10,000 or less. Borrower proceeds from a refinance, if any, are only paid in strict compliance with the written closing instructions provided by the funding lender. Pre-closing consent is obtained from the lender on any request to pay additional parties. If such consent is granted, the changes are listed in the 1300 section of the HUD-1. We do not rely on approval of the mortgage broker. Additionally, the funder s approval of the HUD-1 or closing statement is not sufficient as evidence of consent. If a lender disapproves of any requested disbursement, appropriate parties are notified in writing. Where directed or allowed by Lender, we will accept written instructions for the following: a) Deposit proceeds directly into a bank account on behalf of the principals. b) Cut separate checks or send a wire in the name of each individual seller or borrower. Mortgage Payoffs Must be in writing and should reference the loan number and property address in addition to the borrower s name Monitor home equity lines of credit and obtain a signed closing letter from the borrower to the lender requesting that the credit line be closed. Put sufficient detail on the payoff check to identify the property, loan number and borrower. If property is in foreclosure, make certain you have accounted for any attorney s fees and other court costs.

17 Sellers or borrowers are never to deliver their own payoff statement. Payoff statements must be delivered to BTT directly from the payoff lender or provided by the new lender Escrowed Funds Disbursement Purpose Escrow Officer/Closer is responsible for external disbursements to ensure the payment amounts are supported, proper vendors are paid, and disbursements have been properly authorized Escrow Officer/Closer is responsible for the BTT fee income to ensure that checks/journal entries to recognize our fees are only processed after the order has closed and been fully funded. Procedure All escrow disbursements (check and/or wire) will be handled by Kirsten Hendricks OR Linda Phillips. Since there are only two (2) people in the whole company we cannot have two (2) approvers. If BTT grows and adds employees all disbursements will continue to be made by Kirsten Hendricks and Linda Phillips. If BTT ever adds employees that will be handling disbursements they will need to have approvals signed by Kirsten Hendricks or Linda Phillips before they can disburse any funds. Evidence of the approvals is required on the check disbursement register for every escrow. Cancelled Checks and Stop Payments Procedure Cashier s or Teller Checks BTT does not issue Cashier s or Teller Checks but if there is a situation where a Cashier s or Teller Check is issued by BTT the procedure would be: Stop payment on a Cashier s or Teller Check is issued by the company once the following criteria are met:

18 a) Approval from Kirsten Hendricks is obtained directing that a replacement item is issued. b) An affidavit concerning the lost, stolen or destroyed item from the person whose obligation is paid by the Cashier s or Teller Check is obtained. c) Any requirement by the bank upon which the check is drawn to obtain a bond or other form of security for the amount of the check is satisfied, if the bank is going to reissue the check before a 90 day period has elapsed. Trust Account Checks A check that has been issued and processed in the accounting records, but subsequently lost, stolen or returned to the Company is voided. If the original check has been returned, it is marked Void, the signature portion of the check is blacked out. Voided checks in BTT possession are retained. Prior to reissuance of a returned check, BTT must verify the check has not cleared the bank. A holding period of 36 hours may be necessary to ensure no one has attempted to process the check electronically. If the check has been lost or stolen, the accounting department determines if the check has cleared the bank. If the check has not cleared the bank, the bank is notified to place a stop payment on the check. Upon authorization from the bank and Kirsten Hendricks, a lost check is reissued. If lost checks are later returned, the check is properly noted across the face of the original check that a stop payment was issued on the check. Disbursement or Receipt of Funds by Wire Purpose Wire transfer transactions usually involve large dollar amounts that must be processed quickly. There is also finality to a wire transfer transaction at the time of execution. Generally, wire transfers are not subject to a stop payment, recall, cancellation or adjustment. Once a wire request has been executed, the funds immediately become the property of the transfer recipient. Because of these concerns and to minimize the risk of loss from errors or fraud, wire transfer

19 authority is to be centralized within a limited number of management, accounting or administration employees. Procedure Kirsten Hendricks and Linda Phillips are only authorized people to send and verify a wire transfer. Customers are to communicate all wire transfer requests in writing and provide wiring instructions. Any revisions to wire instructions need to be verbally verified by BTT. Mortgage Fraud Awareness and Prevention Procedure Adhere to all Underwriting Bulletins concerning Settlement Issues. The Company understands that a person that knowingly, with the intent to defraud, does any of the following may be guilty of the crime of residential mortgage fraud: o A person that makes a false statement or misrepresentation concerning a material fact or deliberately conceals or fails to disclose a material fact during the mortgage lending process. o A person that, during the mortgage lending process, makes or uses a false pretense, or uses or facilitates the use of another person's false pretense, concerning the person's intent to perform a future event or to have a future event performed. o A person that uses or facilitates the use of a false statement or misrepresentation made by another person concerning a material fact or deliberately uses or facilitates the use of another person's concealment or failure to disclose a material fact during the mortgage lending process. o A person that receives or attempts to receive any proceeds or any other money in connection with the mortgage lending process that the person knows resulted from a violation. o A person that files or causes to be filed with the register of deeds of any county of this state any document involved in the mortgage lending process that the person knows to contain a

20 deliberate material misstatement, misrepresentation, or omission. o A person that fails to disburse funds in accordance with the settlement or closing statement for the mortgage loan. o A person that solicits, encourages, or coerces another person to participate in any of the above activities. BTT employees are trained to be aware of any of the above listed issues related to a closing. If an employee believes any of the above items are relevant to a transaction, they are to notify Kirsten Hendricks immediately. The transaction will not close or disburse until appropriate authorization is received.

21 BEST PRACTICE SECTION 5 TITLE POLICY PREPARATION Written procedures related to title policy production, delivery, reporting and premium remittance. Title policy production and delivery: o Title insurance policies are issued and delivered to customers in a timely manner to meet statutory, regulatory or contractual obligations. o All policies will be reviewed and approved by Kirsten Hendricks prior to issuance. o Issue and deliver policies as quickly as possible but not to exceed sixty days of the later of (i) the date of Settlement, or (ii) the date that the terms and conditions of title insurance commitment are satisfied. Premium reporting and remittance: o Title insurance policies are reported and premiums are remitted to the underwriter in a timely manner to meet statutory, regulatory or contractual obligations. Report policies to underwriter at the time of policy issuance. Remit premiums including a copy of the policy to underwriter when the title policy is prepared and completed but not more than sixty days from (i) the date of Settlement, or (ii) the date that the terms and conditions of title insurance commitment are satisfied.

22 For policy production and delivery; premium reporting and remittance: o Procedure to track the policy data is to keep a policy log including file #, underwriter file #, policy #, date of policy, date policy is mailed out. o Submitted remittance reports and premium payment submitted to underwriter(s) will be kept in the transaction file. o Kirsten Hendricks or Linda Phillips will be responsible for making sure the procedures are being adhered to. o Written procedures will be provided to employees. o Policy training will be provided to employees to ensure compliance with the procedures. o Kirsten Hendricks or Linda Phillips will be responsible for internal auditing to ensure ongoing compliance in the policy workflow including monitoring and monthly resolution of any A/R issues with underwriters i.e. review of underwriter monthly billing statements and documentation of policies processed. Underwriter premium remittances are paid from each transaction from the escrow account used for that transaction. Production and File Maintenance Policy: Title insurance orders will be have files opened either on the same day or the next business day after receipt. Title insurance searches will be ordered from underwriter in a timely manner. Each policy issued on behalf of the Underwriter is issued upon a determination of insurability of title which includes, but may not be limited to: a. A search from earliest public records or in accordance with applicable state law and/or Underwriter's written instructions; and b. An examination of all documents affecting title to the subject property. Each title order or transaction is prepared and maintained in a separate title file that contains all documents upon which we relied to make our determination of insurability, including, but not limited to: affidavits, maps, plats, lien waivers, surveys, title reports, searches, examinations, and work

23 sheets, together with a copy of each commitment, policy, endorsement and other title assurance issued. All title orders that are revised will be tracked by adding revision language. The file will also include without limitation; closing statements, disbursement worksheets, copies of all checks disbursed and receipted, deposit slips, escrow agreements and any other instruments or documents executed or created at Closing. Employees are required to keep a checklist in the folder. The title and closing files are preserved in accordance with our contractual obligations with our underwriters, in addition to applicable State document retention requirements, or in the case of a legal hold order, in accordance with instructions of our Underwriter(s). In the event that we destroy or disseminate the files for any reason, we shall maintain and protect any confidential or private information contained in such files in accordance with applicable State and Federal law and with any permissions needed per our underwriting contracts. We perform an Open File Audit every month. An Open File is defined as ~ a title commitment was issued with no further communication from the customer who ordered it and no payment of premium has been received. Monthly, all open files will be reviewed that have aged three months or older. We follow up with the party that ordered the commitment to find out the status of the transaction. At each monthly Open File Audit, the file status will be updated to either cancel the file or confirm that the transaction is still active. All files will be audited internally by Kirsten Hendricks prior to issuance of the policies. The following items listed on the Quality Control Review Individual Title File Audit checklist are reviewed: a. Date of Settlement vs. Date All Conditions Met vs. Date of Policy b. Confirmation appropriate premium was charged to the customer c. Documentation of a refund to the customer if an over-charge was discovered d. Date policy was reported and premium was remitted to the underwriter. When claims are filed and the underwriter requests a copy of the file in question, or when files are requested for other reasons, we promptly search for and provide the requested documentation. These include:

24 a. all documents received by Agent in which Underwriter is a party to any administrative and/or judicial proceedings; b. all written complaints or inquiries made to any regulatory agency regarding transactions involving title insurance policies, endorsements, commitments or other title assurances of a particular Underwriter; c. any information alleging a claim involving a policy, commitment, endorsement or other title assurance of an Underwriter or a transaction for which an Underwriter may be liable; d. all original documentation and work papers available associated with the transaction or conduct giving rise to any examination, claim or complaint. In the event a request for a copy of a title policy or settlement statement is presented to our Company, with few exceptions, we may only give a copy to our insured unless the requesting party can provide BTT with a signed authorization from the insured. When faxing, ing, scanning or in any way delivering a policy, the policy jacket and the schedules and all endorsements must be sent, as all the components together make up the policy. The following parties may receive copies of a Lender s Title Policy: a. The insured lender named in the Lender s Title Policy. b. MERS, if MERS is named in the insured deed of trust as the nominee of the insured lender. c. A loan servicer, if the loan servicer provides satisfactory documentation to establish they service the loan for the insured lender. If you receive a written letter from a party who states they service the loan on behalf of the lender, you may rely upon that representation without having to obtain the written consent of the lender. Use good judgment if a request from a servicer appears questionable, of course contact the lender to be sure the request is legitimate. d. A party claiming to be the current holder of the indebtedness, if there is evidence of record such as an assignment of lien that indicates they are the holder of the indebtedness, or other evidence such as a copy of the original note and it shows the note has been endorsed to the party requesting a copy of the policy. e. Any other party with the written consent of the insured lender.

25 The following parties may receive copies of an Owner s Title Policy: a. The insured party named on the Owners Policy. The insured must submit a signed, written request when asking for a duplicate of the Owners Policy. For situations such as heirs requesting policy copies, local underwriting will be consulted for the correct practice. b. When an Owner s Policy is requested by Law Enforcement we instruct our staff to consult local underwriting for the correct practice. If we discover that a consumer has overpaid for a policy, our physical file and electronic file will be documented and we will process a refund for the amount of the overpayment of premium to the consumer with an approval from Kirsten Hendricks.

26 BEST PRACTICE SECTION 6 INSURANCE Maintain appropriate professional liability insurance and fidelity coverage. BTT complies with the requirement to have the appropriate levels of errors and omissions insurance to help ensure our title agency maintains the financial capacity to stand behind our professional services. In addition, our coverage is in line with our state law and title insurance underwriting agreements which includes errors and omissions insurance, fidelity coverage or surety bonds. Current E&O Coverage meets our contractual obligations with our The coverage and deductible matches our agency contract with the underwriter Coverages meet our state requirements Cyber liability insurance coverage is being purchased to meet the new need for protection from cyber threats Cyber liability coverage includes the loss of confidential consumer information and notifies the consumer in addition to providing free credit monitoring What does your policy define as a title claim? Coverage for each policy is for one (1) year and is renewed annually Coverage for future claims related to mistakes made prior to our current policy is included with each renewal unless the policies are interrupted without renewal Current policies cover directors and officers Kirsten Hendricks is monitoring policy expiration dates and ensuring timely renewal Third-party vendors not covered by our policies are required to carry their own coverage

27 BEST PRACTICE SECTION 7 CONSUMER COMPLAINTS Written procedures for resolving consumer complaints. Bright Title & Trust LLC (BTT) is committed to providing a professional, fair, efficient, courteous and helpful service to the public and a key aspect for achieving this is to promptly investigate and, where possible, resolve complaints about its service to the satisfaction of the customer. Dealing with complaints effectively and efficiently is a core element of Bright Title & Trust LLC s customer service and reflects BTT s commitment to service excellence. Kirsten Hendricks should be notified of any type of complaint The state of Florida handles consumer complaints in our industry through the State Department of Financial Services Consumer complaints on Federal level are handled by the CFPB and the CFPB is responsible for the follow up of any reported incident Kirsten Hendricks is responsible internally for tracking and addressing complaints All employees will be trained to know our complaint policy and procedure BTT website will have a place for consumers to fill out a survey about their experience with their transaction and/or file a complaint online. Kirsten Hendricks will be responsible for responding This policy applies to the handling of all formal complaints submitted to BTT. For the purposes of this policy, a complaint is defined as any expression of dissatisfaction about the service/s provided by BTT and/or about the professional conduct of BTT staff, including any sub-contractors used by BTT. Examples of the types of complaints are: Poor service or failure to meet promise/commitment A failure to follow policies, procedures or written instructions Mistakes/Errors by BTT personnel

28 Unreasonable delay caused by BTT Wrong or misleading information provided to consumer A failure to provide explanations or give reasons for decisions Discrimination of any kind, inconsistency or lack of objectivity Inappropriate staff behavior, discourtesy, disrespect or rudeness It is the policy of Bright Title & Trust LLC to provide a complaint resolution procedure that is timely and responsive to consumers of our services. The compliant procedure will be timely and accessible to the consumer. All employees will welcome complaints with the understanding that our goal is satisfied customers. Where possible, all BTT staff should endeavor to resolve complaints at the first point of contact or knowledge of the complaint. Customers who remain dissatisfied after speaking to a BTT Employee should be offered the option of being transferred to the owner, Kirsten Hendricks. If Kirsten Hendricks is unavailable to take the call and/or the consumer would prefer to write in to complain, the BTT Employee should provide the consumer with the company address details ( and/or postal address) and should direct the consumer to the BTT s website where BTT s Complaint Policy is posted and has a survey and complaint form to fill out online BTT will always endeavor to respond to consumer complaints using the consumers preferred mode of communication. Where this is not specified, BTT will usually respond using the same mode of communication as the complainant has used to raise the complaint. IF BTT RECEIVES A COMPLAINT: Step One Upon the receipt of a complaint (all employees need to be sensitive to the idea that consumers may make a complaint in a variety of ways including phone calls, voice mail, , or regular mail) the person receiving the complaint or becoming aware of a complaint will fill out the Company Complaint Form, attaching a copy of any s, letters, or notes from the voice mail, that will be helpful in providing a full picture to the Owner or anyone else involved later in the process.

29 Contact the customer by telephone / to acknowledge receipt of the complaint. Discuss the complaint with the customer and ask the customer how they would like the matter resolved. The Complaint Form should be delivered to the Company s Owner as soon as possible, but in no event later than the end of the business day which the complaint came in or was discovered. The employee will provide the consumer with the Company Owner s name and contact information. Step Two The Owner will review the Complaint Form and any documentation attached. The Complaint will be logged on the Company s Annual Complaint Log and the Owner will determine if there is a need to notify any other parties about the complaint. If necessary, the Owner will request additional information or speak directly with any employees involved to be sure the Owner has all the necessary information (employee s side of the story and surrounding circumstances of any other entities or parties involved) and respond to the party who made the complaint to the best of their ability and authority. The goal is to resolve any complaints within three business days. Depending on the nature of the complaint, the Owner will contact the consumer by the end of the second business day from the Complaint Intake to acknowledge receipt of the complaint and update the customer with the status. If the Owner is unable to resolve the complaint within three business days, the consumer will be updated by the Owner on progress (even if there is no progress) every 3rd day from initial contact until resolution is reached. Step Three The Company CEO, will respond to the consumer within two business days of being notified by the Complaint Coordinator that the issue has not been resolved.

30 The Owner will utilize objectivity and flexibility (being mindful of state and federal regulations for the title industry) in determining the proper resolution. The decision of the Owner is final. Only the Owner shall have the authority to revise the decision should additional information be provided that would warrant a change in part or whole of the Owner s original decision for resolution.