Congress·In Committee·H.R. 3206

Reps. Garbarino and Gonzalez Introduce Bipartisan Bill to Require Traditional Title Insurance for Home Loans

Protecting America's Property Rights Act

11 months ago·View on Congress.gov

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Key Points

This bill targets Fannie Mae and Freddie Mac, requiring them to use title protection products that are regulated by state insurance authorities or state regulators when they buy or sell conventional mortgages. This means the massive companies backing most American home loans must stick with traditional, state-regulated title insurance.
From policy text
“management of risk related to loss or damage suffered by reason of liens, encumbrances upon, or defects in the title to such property, or the invalidity or unenforceability of any liens or encumbrances thereon by utilizing third party products subject to regulation by-- ``(A) a `State insurance authority' as defined in 15 section 6809(11) of title 15, United States Code; or ``(B) a `State regulator' as defined in section 5481(22) of title 12, United States Code.”
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If Fannie Mae or Freddie Mac buy a mortgage that doesn't use a state-regulated title product, they'd face a financial penalty: they must hold an extra 1% of the loan's unpaid balance in reserve capital. This makes it significantly more expensive for these companies to accept newer, less-regulated title alternatives.
From policy text
“the Director shall require the Enterprises to hold an additional 1.00 percent of the unpaid principal balance of any mortgage purchased by the Enterprises that does not meet the requirements of subsection (a).”
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The federal housing regulator (FHFA Director) would have 180 days after the bill becomes law to write the specific rules and guidance needed to enforce these requirements, including making sure the title products are properly regulated by state authorities.
From policy text
“The Director shall, not later than 180 days after the date of enactment of this section, issue such regulations and guidance as necessary to ensure compliance with subsection (a), including requiring the Enterprises to verify that any product meeting the definition in subsection (a) is appropriately regulated.”
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The bill has bipartisan backing, introduced by Rep. Garbarino and Rep. Vicente Gonzalez of Texas. Supporters see it as protecting homeowners from risky title products, while critics argue newer alternatives could lower the closing costs that homebuyers pay. It was referred to the House Financial Services Committee.

HousingEconomy Finance

Impact Analysis

Personal Impact

Who is affectedScoreImpactCertaintyScopeDurationSentiment

Scores: 1 = low, 5 = highSentiment: -5 to +5 (net benefit)

Milestones

2 milestones2 actions

May 6, 2025House

Referred to the House Committee on Financial Services.

May 6, 2025

Introduced in House

What Happens Next

Projected impacts based on AI analysis

180 days after enactment

FHFA must issue regulations and guidance enforcing the new title insurance requirements

Within six months of enactment, Fannie Mae and Freddie Mac would need to verify that mortgages they purchase use state-regulated title products, or face the 1% capital penalty.

Related News

6 articles

HousingWire·almost 2 years ago

House Republicans offer counterpoints to Biden's housing proposals

The Protecting America's Property Rights Act (H.R. 5837) would amend the charters of Fannie Mae and Freddie Mac to require that any loan purchased by either enterprise include title insurance coverage, effectively blocking the use of unregulated alternatives like attorney opinion letters.

Inman Real Estate News·8 months ago

Trump administration expands Fannie Mae title waiver program

The Trump administration has expanded a Fannie Mae pilot program that allows homeowners to refinance without traditional title insurance, despite opposition from lawmakers backing the Protecting America's Property Rights Act who argue the move increases risk for taxpayers and lenders.

Scotsman Guide·8 months ago

Fannie Mae's title waiver pilot program gets second vendor

FHFA Director Bill Pulte announced the addition of Westcor Land Title Insurance Co. to Fannie Mae's title acceptance pilot. The program, which the Protecting America's Property Rights Act seeks to regulate or eliminate, aims to reduce closing costs by leveraging automated title reviews.