Maryland Legal Alert for Financial Services
Maryland Legal Alert - March 2026
In This Issue
2026 ALTA Updates: Key Impacts for Financial Institutions
FinCEN’s New Residential Real Estate Reporting Rule: Implications for Financial Institutions and Real Estate Professionals
Effective March 1, 2026, the Financial Crimes Enforcement Network (“FinCEN”) implemented a new rule requiring certain professionals involved in real estate closings to report information about certain non-financed residential real estate transfers.
What transactions are covered?
A “reportable transfer” is a non-financed transfer of an ownership interest in residential real property to a legal entity or trust. Residential real property generally includes property in the United States designed for one-to-four family occupancy, land intended for such development, residential units within larger structures, and cooperative housing shares.
What transactions are excluded?
Excluded transfers include easements, transfers resulting from death, transfers incident to divorce, court-supervised transfers, certain no-consideration transfers to revocable trusts created by the transferor, and transfers to qualified intermediaries.
Who must report?
This rule places the responsibility on professionals involved in the closing process, such as settlement agents and title professionals, and in some cases attorneys. The rule establishes a reporting cascade to determine responsibility if the parties do not designate a reporting party in writing.
What must be reported?
A Real Estate Report filed with FinCEN must include information regarding:
- The reporting person, including name, role in the transaction, and address;
- The transferee entity or trust, including name, address, and identifying number;
- The beneficial owners of the transferee entity or trust, including name, date of birth, address, citizenship, and identifying number;
- The transferor, including identifying information similar to that provided for the transferee
When must the report be filed?
Reports must be filed by the last day of the month following the month in which the date of closing occurred or 30 calendar days after the date of closing, whichever is later.
Are there penalties for failing to report?
Yes. While the rule itself does not specify penalties, enforcement arises under the Bank Secrecy Act, which authorizes substantial civil and criminal penalties for violations.
For more information concerning this topic, please contact Tamia J. Morris
Contact Tamia J. Morris | 410-576-4021
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2026 ALTA Updates: Key Impacts for Financial Institutions
Recent updates from the American Land Title Association (ALTA) and the National Society of Professional Surveyors (NSPS) introduce revisions to the ALTA/NSPS Land Title Survey Standards, effective February 23, 2026. These updates are intended to improve clarity, coordination, and risk identification in real estate transactions. While many of the changes focus on surveying practices, they will have practical implications for banks and credit unions involved in commercial and residential real estate lending.
The revised standards aim to enhance the reliability of ALTA/NSPS land title surveys, which lenders frequently rely on when evaluating collateral for mortgage loans. The updates refine requirements related to boundary identification, easements, site access, and observable improvements on the property. For financial institutions, these revisions may improve risk visibility during underwriting. More detailed survey information can help lenders identify potential issues—such as encroachments, boundary conflicts, or access limitations—earlier in the transaction process. By improving the quality and consistency of survey data, the new standards help reduce uncertainty surrounding the condition and legal status of collateral property.
One notable change is the addition of Table A Item 20, which allows parties to request a summary of certain observed conditions on the property, including potential encroachments or other physical issues. Although surveyors are not permitted to provide legal opinions, this optional reporting item provides lenders with a clearer snapshot of potential concerns affecting the property. For lenders who frequently rely on ALTA surveys to satisfy title insurer requirements, this change may enhance the usefulness of survey documentation during the due diligence process.
In addition to survey updates, ALTA has introduced several new and revised title insurance endorsements addressing emerging risks in real estate transactions. These endorsements include coverage related to issues such as fraudulent deed or mortgage filings and certain solar energy installations on residential properties. For financial institutions, these endorsements may provide additional risk mitigation tools to protect collateral securing mortgage loans.
In addition to survey updates, ALTA has introduced several new and revised title insurance endorsements addressing emerging risks in real estate transactions. These endorsements include coverage related to issues such as fraudulent deed or mortgage filings and certain solar energy installations on residential properties. For financial institutions, these endorsements may provide additional risk mitigation tools to protect collateral securing mortgage loans.
Practice Pointer: Financial institutions engaged in real estate lending should review internal policies and work closely with title professionals to ensure their due diligence processes align with the new 2026 ALTA requirements.
For more information concerning this topic, please contact Tamia J. Morris
Contact Tamia J. Morris | 410-576-4021
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