Bulletin: NJ2022001

Dear Associates:

Please be advised that on January 18, 2022, the State of New Jersey has enacted the following bill, S3081, which repeals Section 39 of P.L.1975, c.106 (C.17:46B-39), and permits a consumer to exercise their free choice in the selection of the title or settlement services company of their choosing.

Previously, the law provided that if the rates and charges for personal or controlled insurance from any one source so issued in a calendar year received by a title insurance company or by a title insurance agent exceed 25%, or from all sources exceed 50% of the total rates and charges received by the title insurance company or title insurance agent for title insurance issued in the same year, the excess was considered an unlawful rebate that was subject to penalty.

This bill now eliminates this provision of law and shall take effect immediately.

Also, the bill provides that any agreement by a consumer to use the services of a title or settlement service company shall be subject to attorney review, if any, which is part of the contract for sale of real estate and may be revoked in the same manner as provided in the contract for the sale of real estate. This bill further states that a person in violation of this bill shall be subject to a 90-day business license suspension for a first violation.

A second violation will be subject to a 180-day business license suspension; and liable to a penalty of not more than $1,000 for each violation.

Lastly, a third and any subsequent violation will be subject to a one (1) year business license suspension; and liable to a penalty of not more than $2,500 for each violation.

If you have any questions relating to this or other bulletins, please contact a Stewart Title Guaranty Company underwriter.

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