Closing Protection Letters in Alabama

Overview

Closing Protections Letters ("CPL"), also called Settlement Protection Letters, are authorized to be issued in Alabama as part of single transactions only. They may be issued to borrowers, buyers, lenders, and sellers in a given transaction.

Sources

The issuance of Closing Protections Letters is permitted under Section 27-3-6.1 of the Code of Alabama [1]. This code section also defines the content, uses, and minimum fees for a CPL in Alabama.

Compliance

See Section 27-3-6.1 of the Code of Alabama for details concerning the contents, uses, and minimum fees for a CPL in Alabama.

Disclosures

At or prior to closing any transaction involving the purchase or sale of a fee simple or possessory interest in real property, in which a CPL has not already been requested by the lender prior to closing, a written statement must be obtained from the parties to the transaction acknowledging that they have received a notice that a CPL may be available for them and that they do not desire to purchase a CPL. Section 27-3-6.1(e). The notice must contain the following:

• (1) The address or legal description of the property.
• (2) A disclosure that closing protection may be available in accordance with the guidelines of the title insurer and the fee therefor.
• (3) A space to indicate the desire of the purchaser to either acquire or decline closing protection.
• (4) The date the notice is executed by the purchaser.
• (5) The signature of the purchaser or purchasers. Id.

Forms

Disclosure Form

• None filed
• [link to proposed form for agents]

CPL Form

• Latest CPL Form Filing Date: 01-26-2016
• Filing Requirements: Form & Rate to be filed
• Current From: 3172900
• ALTA Version: 2015

Dual Agent CPLs

There is no specific prohibition against the issuance of a dual agent CPL.

Rates

State Mandated Rates

• Buyer: $25.00 (minimum)
• Seller: $50.00 (minimum)
• Lender: $25.00 (minimum)
• Borrower: $25.00 (minimum)

WFG Rates

• Buyer: $25.00
• Seller: $50.00
• Lender: $25.00
• Borrower: $25.00

Remittances

100% of any CPL fees must be remitted to the Underwriter.

Notes

• Notes:
• Rate Checked: 5-6-2016
• By: ABF
• Manual Date:

Cross-References

• Alabama
• Closing Protections Letters