On August 26 the Federal Reserve held a webinar addressing some FAQ's from the CFPB's TILA-RESPA Integrated Disclosure Rule. One hot topic covered was whether or not owner's title insurance is subject to the 10% tolerance rule. Below is a summary from the webinar:
Q: Is owner’s title insurance not required by the creditor subject to the 10% cumulative tolerance?
No. Owner’s title insurance that is not required by the creditor is not subject to the 10% cumulative tolerance.
Owner’s title insurance is not a charge that is assigned to a particular tolerance category. If owner’s title insurance is not required by the creditor and is disclosed as an optional service, it is not subject to any tolerance violations, even if paid to an affiliate of the creditor.