An Act To Allow a Mortgagor To Select a Land Title Company To Perform a Title Search
Maine Legislature, Session 121, LD 0560
Committee: Insurance and Financial Services
Sponsors: SHERMAN, NASS
Amends: 9-B MRSA §241

Legislative Document 
No. 560 
H.P.423 
House of Representatives, February 6, 2003 
An Act To Allow a Mortgagor To Select a Land Title Company To 
Perform a Title Search 
Reference to the Committee on Insurance and Financial Services suggested and ordered 
printed. 
Presented by Representative SHERMAN of Hodgdon. 
Cosponsored by Senator NASS of York. 
Printed on recycled paper 
1Y/~1n.~ 
MILLICENT M. MacFARLAND 
Clerk 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 9-B MRSA §241. sub-§4. as amended by PL 1999, c. 218, 
§3, is further amended to read: 
4. 
Land title companies or attorneys. 
Every financial 
insti tution authorized to do business in this State and every 
credit union authorized to do business in this State that accepts 
an application for 
a residential mortgage loan for one to 4 
residential units and that requires that-aR-a~~e~Rey g search of 
the title of the subject real estate shall permit the prospective 
mortgagor to select a land title company or a qualified attorney 
of the mortgagor's choice to search the title of the subject real 
estate aRa-~~~~1r-~hat-~~~~~-~-~he-~it~~-e~--~-tit±e 
iRs~Faaee-eempaaYr-eHeep~-that-~he. 
The land title company shall 
provide title insurance to the institution or the attorney shall 
certify the title to 
the 
institution. 
The 
institution may 
require the prospective mortgagor's attorney to provide it with 
evidence of adequate liability insurance or land title insurance 
or such other written policy requirements as the institution may 
determine necessary to protect its interestsT-a6-±eR~-a6T-iE. If 
all requirements are met by the attorney chosen by the mortgagor, 
additional legal costs may not be assessed by the financial 
institution or credit union against the mortgagor for review of 
the title search or the 
review or preparation of 
any other 
relevant title documents by the institutionT-i~6-~i~±e-€empaBY or 
.ill attorney. 
The mortgagor may provide a land title insurance policy 1n lieu 
of an attorney's certification to the lending institution. 
Every financial institution and credit union subject to this 
subsection 
shall 
provide 
written 
notice 
to 
the 
prospective 
mortgagor that the mortgagor has the right to select a land title 
company or a qualified attorney of the mortgagor's choice for the 
performance of ~itle-weFk closing services, along with a list of 
land title companies and g:ualified attorneys. 
The notice must 
inform the prospective mortgagor whether the institution reg:uires 
title 
insurance. 
The 
notice 
must 
inform 
the 
prospective 
mortgagor that, if the title insurance is reg:uired or if the 
g:ualified attorney chosen by the mortgagor meets the financial 
institution's requirements, additional fees may not be charged to 
the 
mortgagor 
for 
~i~±e--weFk closing services. 
It is 
the 
mortgagor's responsibility to provide a mortgage and promissory 
note as reg:uired by the lending institution. 
If the prospective 
mortgagor indicates on the written notice that the mortgagor does 
not wish to exercise the mortgagor's right to select a land title 
company or an attorney, then the institution may recommend a land 
title company or an attorney. 
A financial institution may not 
reg:uire the mortgagor to pay for closing services by an attorney 
Page l-LR0902(1) 
... 
or 
land title 
company 
for 
legal 
services 
rendered 
to 
the 
financial institution as part of the closing. 
This subsection may not be construed to require certification of 
title 
to 
a 
financial 
institution 
or 
credit 
union if that 
institution does not so require or to a 
land title insurance 
company if that 
company 
does 
not 
so 
require. 
A 
financial 
institution may not require both certification of title and title 
insurance to protect its interests. 
Any 
violation 
of 
this 
section 
by 
a 
financial 
institution 
authorized 
to 
do 
business 
in 
this 
State 
or 
credit 
union 
authorized to do business in this State is an anticompetitive or 
deceptive practice as defined in this chapter and subject to the 
remedies provided in this chapter in addition to 
such other 
remedies as may be provided otherwise by law. 
SUMMARY 
This bill requires that a financial institution or credit 
union that accepts an application for a residential mortgage for 
to 4 
residential units and requires a title search on the 
property subject to the mortgage must permit the prospective 
mortgagor to select a 
land title company to perform the title 
search.