When do I need to file my capitalization certification?
If you're using unencumbered assets (not a deposit with the Department), you must submit Form T-S1 annually between September 1 and September 30 along with your annual escrow account audit.
Do I have to get a surety bond as a title agent in Texas?
No, a surety bond is optional. You can meet capitalization requirements through other methods including cash, liquid assets, real estate, investments, deposits with the Department, letters of credit, or solvency accounts. The surety bond is simply one alternative listed in the statute.
What qualifies as unencumbered assets under Texas law?
Texas Insurance Code §2651.012(a)(2) defines unencumbered assets as: cash or cash equivalents, liquid assets with determinable market value and no liens, real estate equity, investments (mutual funds, CDs, stocks/bonds), surety bonds, deposits with the Department, qualifying letters of credit, and solvency accounts.
Where do I send my Form T-S1 in Texas?
Submit Form T-S1 to Texas Department of Insurance, Title Examinations, Mail Code: FRD, P.O. Box 12030, Austin, Texas 78711-2030 or 1601 Congress Avenue, Austin, Texas 78701, or email to TitleExaminations@tdi.texas.gov.
What capitalization schedule applies to me as a Texas title agent?
Your schedule depends on when you were first licensed. Agents licensed before September 1, 2013 had graduated phase-in schedules ranging from 3-9 years based on tenure. New agents licensed after the rule's effective date must have 100% capitalization from day one.
Do I still need to file Form T-S1 if I made a deposit with the Department?
No, agents who make a deposit with the Department under §2651.012(f) are exempt from the annual Form T-S1 certification requirement. Instead, you must provide written notice at license renewal that the deposit has been made and meets your capitalization requirement.
What happens if I don't meet the capitalization requirements?
Title agents must maintain the required capitalization amounts according to the compliance schedule. Failure to meet these requirements could result in license issues or disciplinary action by the Texas Department of Insurance.
Can I use real estate to meet the capitalization requirement?
Yes, real estate can count toward your unencumbered assets, but only the equity portion in excess of any encumbrances (mortgages, liens, etc.) counts toward the requirement.
