Wisconsin Governor Signs WLTA-Approved Bills

It has been a busy legislative session this winter and spring for the title insurance industry. ATG along with the Wisconsin Land Title Association (WLTA) and other industry-related stakeholders have accomplished three positive legislative changes. The new laws will help protect property owners by limiting the time in which interested parties can object to a Transfer by Affidavit or Transfer on Death deed. This will, in turn, limit the potential of claim exposure on the title policy. There was also cleanup legislation as to now-eliminated Rental Weatherization law.

Thomas G. Cullen photo

The following summary is excerpted from the memorandum prepared by WLTA regarding the various pieces of legislation.

Rental Weatherization – A bill passed in 2018 eliminating Wisconsin's Rental Weatherization requirements, but was silent on what happened to waivers and stipulations entered into before the elimination of the program. That was fixed when the Governor signed a bill that rendered all outstanding waivers and stipulations null and void. All facets of the old Rental Weatherization statutes are now completely dead.

Transfer by Affidavit – The new law provides protection to good faith buyers and lenders from the claims of heirs who were wronged by a deceitful beneficiary on the Transfer by Affidavit. This is a huge improvement on the legislation, but does come with one caveat:

  • The party taking title to real property through Transfer by Affidavit must give notice to the appropriate heirs at the time of recording. The heirs have 30 days to object to the Transfer by Affidavit. If they do not, they can no longer make claims against the real property.
  • A title agent must review the Affidavit and make sure the 30 days have passed before any transfer based on a Transfer by Affidavit can be insured.
  • This is likely to slow down transactions. Often the Transfer by Affidavit is used at the last minute and not 30 days before a scheduled closing.
  • The bill is effective immediately, but the new form and instructions have not yet been approved.

Transfer on Death – This bill makes a number of changes to the Transfer on Death Deed:

  • A wide variety of documents can now serve as notice designating a Transfer on Death Beneficiary. The standard Transfer on Death Deed is not required.
  • The TOD can transfer fractional ownership interest in a property.
  • The TOD can transfer to any entity that is able to own real property. It does not have to be a person, but can be a trust, corporation, or other legal entity with rights to own real estate.
  • Must be submitted to the Register of Deeds for recording prior to death.
  • Anyone contesting the TOD must do so within 120 days of death. After that, there is no ability to contest a transfer based on the TOD.
  • This legislation is also effective immediately, but no new forms have yet been approved.

If you need more information on how this impacts your title operations or have any questions, please contact the Wisconsin ATG office.

Thomas G. Cullen
ATG Vice President and Managing Attorney - Wisconsin Operations

By: ATG Underwriting Department | Posted on: Mon, 04/30/2018 - 7:24pm