Much has been written recently regarding the widespread, sophisticated frauds which have affected the entire real estate industry.
Stewart Title has determined that this rise in fraud risk stems from a subset of private lenders that finance residential refinance transactions with loan amounts typically over $500,000.
Accordingly, we have had to examine our risk tolerance and adjust our coverage and underwriting protocols.
For files closing after Friday, January 21, 2022, Stewart Title will no longer issue policies for residential refinance transactions with mortgages over $500,000* for private lenders that have not been pre-screened by Stewart Title.
As a reminder, pre-screened private lenders have met one or more of the following criteria:
Is a mortgage investment corporation under the Income Tax Act
- Is regulated by a Canadian federal or Canadian provincial regulator
Is approved for mortgage underwriting under the National Housing Act
Is listed on a stock exchange within Canada that is a designated stock exchange for the purpose of the Income Tax Act
The subset of private lenders impacted by this coverage change will generally be private individuals, numbered companies, or companies not in the ordinary course of doing lender business or regulated as per the above-noted criteria.
We thank you for your continued business and support.