Currently before the State Legislature are two bills, each jointly introduced in both houses, that would inject the state in the business of title insurance, damaging New York’s standing as the capital of real estate transactions. One would broaden the power of the State Insurance Fund to provide a State alternative to the current private system of title insurance.1 The other would create a new state title authority for the same purpose.2 The latter also earmarks the presumed profits of the new system for certain favored public projects, such as affordable housing and road construction. Neither bill sets forth how and where offices would be set up or what standards would be used to insure title. Both bills leave those details to the respective agencies administering the program. We deal with the two sets of bills as a unitary concept, State Title Insurance (STI).
After a number of highly controversial recent enactments, many real estate attorneys have come to understand that any bill may become law no matter how devastating the significance or ill thought out the consequences. Many of these attorneys see these bills as a threat, both to the heart of the safe transfer of real estate and to the capitalist system itself. They fear both government competition against a healthy private industry and the extensive and expensive investment and undertaking such a new enterprise would require. Finally, they doubt that New York State is either qualified to undertake these tasks or can afford to administer them.
A Faulty Analysis
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