Funding and Fiscal Affairs, Loan Policies and Operations, and Funding Operations

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The Farm Credit Administration (FCA), by the Farm Credit Administration Board (Board), adopts a final rule amending its regulations to allow Farm Credit System (FCS) institutions to document the existence of a first lien on the security for long-term real estate mortgage loans by obtaining title insurance or an attorney's certification. The current regulation requires that an attorney's certification be obtained for every long-term mortgage loan in order for that loan to qualify as collateral for FCS debt obligations. The regulation is being amended because title insurance has become the prevailing method used by the mortgage lending industry to ensure clear title. Additionally, the revised regulation permits FCS institutions greater flexibility in determining which method for validating first lien position (an attorney's certification or title insurance) provides the institution the most cost-effective and efficient protection.