Previously Submitted Questions and Answers

Why did you select Qualia Labs, Inc. over other vendors?

Qualia Labs, Inc. is one of the few independently-owned companies offering technology customized for our industry. Additionally, they provide the only web-based offering designed to support underwriter functions such as remittances and reconciliations. We selected Qualia because of their outstanding technology solutions, pricing structure and support, in addition to the long list of enhanced features the system will provide our participants.

Will stakeholders have input into the customization of the system?

Yes. After our agreement with Qualia Labs, Inc. is finalized, a series of stakeholder focus groups will be assembled. The focus groups will be comprised of representatives from each industry group with special attention paid to providing representation for organizations of all sizes and locations. Once offices start coming on board to Qualia they will have access to Qualia’s support staff who will help them to configure their own unique deployment based on the individual stakeholder’s needs.

When is the proposed timeline for implementation of the new system?

The proposed timeline is as follows:

  1. August 2019: Agreement with Qualia signed
  2. August 2019: Stakeholder focus groups with selected representatives from each industry group (Lenders, Abstractors, Attorneys, Field Issuers, Closers, Realtors, Home Buyers)
  3. August.- November 2019: Development
  4. December 2019 – January 2020: Beta testing and training
  5. January 2020: System rollout and availability for use by participants
  6. March 2020: Full transition to new system for new ITG commitments and certificates
What is the data security/privacy offered?

Historically, insecure communication and outdated software has exposed sensitive data to costly breaches in the title industry. That trend is only growing in recent years with First American’s massive breach of 2019 being widely blamed on dated technology. Qualia’s data security group has mitigated these risks by building a technology infrastructure and closed workflow environment that both protects from malicious attempts at breaches as well as reduces processor errors that may lead to breaches.

Qualia has invested heavily in the security and reliability of its platform, earning the American Land Title Association’s ALTA Elite Provider status as well as the American Institute of Certified Public Accountants’ (AICPA’s) Service Organization Control 2 (SOC 2) certification, and third party accreditation as a certified ISO/IEC 27001:2013 provider from the International Standards Organization.

Qualia is widely-recognized as a national thought leader on data security, one of their recent media features on the subject aired on NBC and is available here.

Is there a fee for the new system?

Yes, to pay for the development, operation, training, ongoing maintenance and support of ITG’s new title production system powered by Qualia Labs, a $30 per transaction fee will be added to the cost of ITG’s title coverage once the new system goes live in January of 2020.

Will the new system be able to integrate with other systems we may already be using, such as SoftPro?

Participants who choose to continue using their existing production software can certainly do so, but the new system developed by Qualia Labs will not integrate with them. Due to the difficulties inherent to on-premise software installations, any such integration would have to be built on a case by case basis. This is part of the reason that the State of Iowa is making a broader move towards cloud and web-based services.

Currently, ITG’s CAP system does not integrate with any title production software so most participants are already using two systems.

Participants will be required to use ITG’s new system powered by Qualia to issue and pay for ITG title coverage products (commitment, certificates, endorsements and closing protection letters). Qualia is providing ITG participants with full access to all features of its industry leading title production software at no additional charge so that ITG participants may perform all of their title and closing tasks in one secure environment but use of such features is optional. Please note that other charges may apply for optional third-party provided products and services available through Qualia’s Marketplace (i.e., electronic recording services, release tracking services, etc.).

Will there be trainings available?

Yes, beginning in late 2019, Qualia will be sending representatives to Iowa to introduce and train on the software through a series of presentations and hands on webinars. On an ongoing basis, there will be opportunities for additional in-person sessions as needed as well as access to videos and webinars. In addition to these resources, Qualia has a learning management system built into the software that will allow for participants to learn at their own pace.

How long has Qualia been around?

Qualia has been around for five years. They have partnerships with hundreds of banks, top service providers in the industry and are integrated with every major underwriter. They are also the fastest growing settlement software in the country.

How do I know Qualia is not going to get bought out?

Qualia just earned $33 million in funding from the same investors behind companies like Uber to continue doing what they’re doing.

How do I know Qualia is not going to go out of business?

Qualia is backed by top tier investors who just awarded Qualia $33 million in funding to continue supporting product expansion. While it’s impossible to predict the future of any company, Qualia is currently processing thousands of transactions per day for more than 1,200 companies and is executing a long term, managed growth strategy designed to reduce risk and ensure continuation of services.

How many people are on Qualia’s team?

Qualia has roughly 170 employees divided between engineering, sales, and support. All support is housed in their Austin, TX office and can be accessed both by phone and email.

If I stop using Qualia, do I get access to my data?

Should you ever decide to stop using the Qualia platform, you will still have access to the system. Should Qualia ever have to shut down for any reason causing your loss of access to the system, Qualia will provide your data in an XML format and your documents in a navigable file system.

Can anyone else see my data?

Each participant runs in a completed isolated, virtualized environment. If you think of Qualia as an apartment building, you’re the only one with a key to your unit. All data storage is isolated by customer; each database and persistent file store is unique per customer.

How are documents (or other data) stored on your system?

Securely, in the cloud. Qualia utilizes the same cloud-based system as the US Department of Defense.

Does Qualia charge any fees other than the $30 per transaction fee to access their title production system?

No. Please note other charges may apply for optional third-party provided products and services available through Qualia’s Marketplace (i.e., electronic recording services, release tracking services, etc.).

Does Qualia support positive pay?

Yes.

Does Qualia support 1099 reporting?

Yes.

If I work with an external CPA, will they know how to reconcile in your system?

Yes. The interface is very similar to other reconciliation systems.

Does the system automatically do reconciliations for me?

The system can automatically clear your bank items, so that you don’t have to manually clear all those items for your reconciliations. You still have to clear exceptions and produce the final reconciliation reports, but Qualia has made it much easier for you.

Can Qualia auto-clear wires?

Yes. You can configure how strict the system is when clearing wires. For example, you can choose to match only based on the amount and clear date, or require an instrument number as well.

Can Qualia produce 1986 HUD?

Yes. They also support the 2010 HUD, the Closing Disclosure, the ALTA settlement statement and a commercial settlement statement.

Will it be difficult to train my staff on this system?

Even though the system is easy to use, they’ve designed their learning management system, Qualia University, to make training your staff really quick and easy. The trainings are separated into modules that they can take at their own pace. You can even track your team’s progress to make sure no one is falling behind.

Additionally, Qualia and ITG are partnering to provide a comprehensive series of trainings and seminars right here in Iowa.

What are Qualia’s support hours?

Qualia’s phone support hours are 7:00 a.m. -5:00 p.m. Monday-Friday CT.

How quickly will Qualia respond to support requests?

If you call during support hours, you’ll get a response in minutes.

What if I need to add my own documents?

The system includes a document customization system that lets you add whatever you need. Document storage is included and unlimited.

I do mostly commercial work. Does Qualia’s system handle that?

Yes, many of their users do large commercial work.

Is Qualia on the blockchain?

No.

Who owns the data once entered into the system? Does the system vendor or ITG have any rights to use, compile, share, sell or otherwise use the data for any secondary purposes?

As noted on the resource portal, an excerpt of Iowa Title Guaranty’s agreement with Qualia includes the following language regarding data security and ownership:

As between Partner and Qualia, Qualia hereby confirms Partner’s ownership of all data and Confidential Information that Partner provides to Qualia (collectively, "Partner Data"). …. Notwithstanding anything to the contrary contained in this Agreement or in any exhibit or attachment hereto, Qualia shall not disclose any Partner Data to any third-party during the term of this Agreement or thereafter without first obtaining Partner’s written permission for such disclosure. If Qualia is compelled by law or legal process to disclose Partner Data to a third-party, Qualia shall first notify Partner no less than 72 hours prior to such disclosure so that Partner may, at Partner’s option, seek injunctive relief to prevent such disclosure.

ITG has the right to use the data to perform audits and compile analytics but will not share or sell data provided within the platform.

ITG will have individual agreements with participants which will govern the terms of data usage and ownership. Participants will retain sole ownership and will remain the only party with access to their confidential data.

How does adding a technology platform address underwriting performance issues that may prompt a lender or settlement agent to choose title insurance rather than Iowa Title Guaranty? Such as reluctance to insure over title issues, even when those pose minimal risk.

Iowa Title Guaranty remains the best choice for consumer protection due to Iowa’s superior title standards, facilitated by our abstract and attorney examination system. While out-of-state title insurance companies may insure over title issues, the Iowa Title Guaranty program requires that all title issues be unequivocally resolved. Iowa’s history of exceptionally clean title results in fewer claims than those experienced by title insurance companies and allows Iowa Title Guaranty to continue to offer low premiums. Lenders and settlement agents have a fiduciary obligation to protect home buyers. Decreasing Iowa’s title standards for a lender or settlement agent’s convenience, at the expense of the consumer, violates these fiduciary obligations and contradicts Iowa Title Guaranty’s duty to ensure Iowa property owners obtain clear title. The new software system will enhance the title production process as a part of delivering Iowa Title Guaranty’s gold standard in title protection for Iowans.

What reassurance do we have regarding the security of our information provided through the system?

As noted on the resource portal: Historically, insecure communication and outdated software has exposed sensitive data to costly breaches in the title industry. That trend is only growing in recent years with First American’s massive breach of 2019 being widely blamed on dated technology. Qualia’s data security group has mitigated these risks by building a technology infrastructure and closed workflow environment that both protects from malicious attempts at breaches as well as reduces processor errors that may lead to breaches.

Qualia has invested heavily in the security and reliability of its platform, earning the American Land Title Association’s ALTA Elite Provider status as well as the American Institute of Certified Public Accountants’ (AICPA’s) Service Organization Control 2 (SOC 2) certification, and third party accreditation as a certified ISO/IEC 27001:2013 provider from the International Standards Organization.

Qualia is widely-recognized as a national thought leader on data security, one of their recent media features on the subject aired on NBC and is available here.

What type of analytics will be provided, shared or collected?

The authorized users of any given deployment will have the ability to create custom reports only from the data entered in their deployment. This reporting feature will operate as a business management tool, allowing the authorized user to examine processes, procedures and business trends. It will also serve as an accountability and auditing tool. As stated, only authorized users within an organization or firm will have access to the data, unless the authorized user voluntarily grants specific permission to a third-party user. The software will also be role-based. For example, management could limit which staff members may view reports or grant third-party permissions.

As noted on the resource portal: Each participant runs in a completely isolated, virtualized environment. If you think of Qualia as an apartment building, you’re the only one with a key to your unit. All data storage is isolated by customer; each database and persistent file store is unique per customer.

ITG will use the information on the new system in the same way that we use the data in CAP. However, the software will provide a more robust and efficient system to track participant volume, completeness, open files, payments and delinquencies.

It seems as if the implementation of a title industry software platform by ITG (a state organization) that provides services beyond the original intent, scope or charter of ITG’s stated mission, to independently owned and operated capital enterprises may further the efforts to bring title insurance to the state. It has been stated by some that this initiative is a proactive measure to bring a title insurance platform to the state without allowing title insurance within the state. Would you please address the impact this action will have upon the eventual entry of the title insurance industry to Iowa?

The implementation of up-to-date title industry software reinforces the core of Iowa Title Guaranty’s mission set out in IAC 9.3, in that our new software will allow us to “operate a program that … add[s] to the integrity of the land-title transfer system.” It is our duty to provide a system that facilitates mortgage lenders’ participation in the secondary market.

Therefore, ITG must do what it takes to remain competitive in the eyes of mortgage lenders. The enhancement of the title production software will address the most common complaint expressed by lenders: Iowa’s slow title process. We aim to protect our title system by arming our participants with the tools necessary to provide expeditious service. Lenders and borrowers should choose Iowa Title Guaranty because we offer the best product and performance, not because ITG is the only option.

Providing supplemental services is not the focus of our software, but is a free, optional perk that our Qualia contract will allow us to provide to our participants.

The “proactive measure” is to show mortgage lenders that we are just as transparent and all-encompassing as the title insurance industry, NOT to align ourselves, as we do not concede that title insurance is entering Iowa “eventually” or otherwise.

What are the security protocols in place to safeguard against cyberattacks/data breaches?

As noted on the resource portal: Historically, insecure communication and outdated software has exposed sensitive data to costly breaches in the title industry. That trend is only growing in recent years with First American’s massive breach of 2019 being widely blamed on dated technology. Qualia’s data security group has mitigated these risks by building a technology infrastructure and closed workflow environment that both protects from malicious attempts at breaches as well as reduces processor errors that may lead to breaches.

Qualia has invested heavily in the security and reliability of its platform, earning the American Land Title Association’s ALTA Elite Provider status as well as the American Institute of Certified Public Accountants’ (AICPA’s) Service Organization Control 2 (SOC 2) certification, and third party accreditation as a certified ISO/IEC 27001:2013 provider from the International Standards Organization.

Qualia is widely-recognized as a national thought leader on data security, one of their recent media features on the subject aired on NBC and is available here.

As Qualia is a cloud-based system, what measures have been taken to review the security of the data center hosting the solution. What plans are in place to scale the solution hardware should capacity exceed the contracted for space? What level of stress tests have been conducted on the cloud environment and what were the test outcomes?

As noted on the resource portal: Qualia utilizes the same cloud-based system as the U.S. Department of Defense.

After a comprehensive review of security and functionality requirements by IT security professionals, legal and end-user staff, ITG has complete confidence that the Qualia product will meet the needs of both today and tomorrow for Iowa Title Guaranty and its partners.

Is there a Service Level Agreement proposed? If so, what is the SLA being offered by Qualia?

The SLA is 72 hours.

Who do you foresee being expected to use the system? Abstract Companies, Settlement Agents, Attorneys?

There is no change from the current system. Field issuers will be expected to use the system for title production. However, we strongly encourage all parties to a transaction to use the communication features of the platform, at no cost.

What functions of the system may be required to be used?

The system will be required for title production. Other software features will be available for use at no cost. As it pertains to this question, title production means the production and issuance of title commitments, closing protection letters and title certificates.

Which data fields will be captured, and what data entry will be required by the abstracter, attorney, lender, and closer?

There is no change from the current title production system.

However, if a user voluntarily elects to take advantage of the other no-cost features, all merge fields completed will prepopulate throughout the transaction. For example, if the Seller’s name is entered as a party to the transaction, his or her name will prepopulate into the Commitment, the closing disclosure, disbursement checks, and any added template forms, such as letters, deeds, etc.

Why is the government expanding its role beyond underwriter to openly compete against the private sector?

Iowa Title Guaranty is not expanding its role and will not be competing against the private sector. ITG is simply enhancing its title production software to better serve the citizens of Iowa as the state’s underwriter. ITG will not be conducting residential closings or taking on any new roles. The optional settlement features included with the Qualia system are being provided as a benefit to our participants, at no cost.

Our goal is to promote and protect the Iowa attorneys, abstractors, closers, and field issuers. The enhancement of the title production software will address the most common complaint expressed by lenders: Iowa’s slow title process. We aim to protect our title system by arming our participants with the tools necessary to provide expeditious service. Lenders and borrowers should choose Iowa Title Guaranty because we offer the best product and performance, not because ITG is the only option.

With the cost of Qualia being roughly $2 million per year (based on the number of ITG transactions in 2016), would it not be more cost effective and in the best interest of ITG and Iowa tax payers to invest in a system that can directly address those deficiencies with the existing CAP system, instead of opting for the more expensive Qualia product that seems to be geared more for performing the functions of a settlement agent?

The per transaction fee is for the title production software alone. While the enhanced security and consumer protection features alone justify the cost of the software update, the fee also includes access to Qualia’s full-time support staff, a chat feature for instant troubleshooting, customizable reporting functions, online video tutorials and written training materials. The optional settlement and escrow features are being provided at no cost.

ITG has conducted significant research as to the available title production software on the market. The other providers considered were server-based, which would require each of our 1,400 participants, as well as lenders, realtors and borrowers to purchase and install software onto their individual computers to be able to use the system. The industry is moving away from server-based software, due to the inefficiencies and increased costs associated with management and updates. ITG believes it is unreasonable to require that every individual involved in an Iowa real estate transaction purchase and download server-based software. Further, the server-based models would require that ITG hire at least two additional full-time employees to manage the day-to-day program.

Prior to looking to a third party, ITG also considered the cost of developing a new system in-house. However, neither Iowa Finance Authority, Iowa Title Guaranty, nor the State of Iowa is in the software development business. The current system cannot compete with Qualia’s software in terms of efficient title production, data security, training, support and cost. Our software developers have confirmed that the expense of attempting to create a similar system internally would greatly exceed the cost of contracting with Qualia to develop the program. ITG would not be able to replicate the software for the investment amount.

Finally, Iowa taxpayers do not fund ITG, as ITG is self-funded. Purchasing the system from Qualia is in ITG’s best interest.

How will the implementation of this new system specifically improve the accuracy of legal descriptions?

The legal description will be entered into the new system once, which will reduce the number of typographical errors. Currently, the legal description is manually keyed into various documents (i.e. title opinion, title commitment, deed, mortgage). Frequently, typographical errors occur and ITG experiences claims related to these errors. The new system will use the legal description verified by the abstractor and entered into the merge field to prepopulate all transaction documents within the platform. This feature will be exceptionally useful if participants elect to use the free optional features and upload their template forms into the system.

How can the legal description be collected from an uploaded abstract when there is no consistency with the location of the legal within an abstract? Will it require the abstracter to enter the legal description separately?

ITG is not requiring that the abstractor upload the abstract. ITG prefers that the abstractor copies and pastes the accurate legal description into the legal description field within the system. This process is no more onerous than the common practice of sending the Word version of the legal description to the closer via email. Once uploaded to the system, the legal description will prepopulate throughout the transaction without any additional rekeying. This will significantly reduce the risk of typographical errors. As always, the abstractor must verify the legal description before entering.

Will the abstract be required to be uploaded? If so, on what basis and what format?

No.

Will the abstract be retained by ITG and/or shared to other parties beyond the initial transaction?

No, ITG will not retain or share abstracts provided, however, that ITG continues to reserve the right to request any abstract for examination pursuant to the terms of our participation agreements.

How does the system link book/page to images?

We are not requiring that users upload digital images of the abstract to be hyperlinked with a book and page. However, the software will allow users to upload and hyperlink any relevant documents for review by the parties to a transaction. For example, the examining attorney may wish to upload a plat map, declaration of covenants or access easement for the seller’s attorney’s review.

Does the abstracter have to upload documents as well?

No, except for the legal description as verified by the abstractor. However, the uploading of any relevant documents is encouraged.

Will the system link to Iowa Land Records which is NOT the official Record?

No.

What is the Market Place and how will it work?

The marketplace allows for any party acting as a “Vendor” to be selected, charge/pay, communicate and share information seamlessly.

Will participants such as the examining attorney, closing company, and abstracter all be selected from the “Market Place”?

Any party that is acting as an individual participant (vendor) will be able to be selected by anyone using Qualia looking for the service.

Will pricing be required to be provided?

Estimates will be required but since billing will be conducted seamlessly through the system, modifications on every transaction are easy.

Will all participants be listed as an option available on every transaction for selection?

There is no change from the current system. The new software will provide a list of ITG participants just as the Resource Desk currently provides. Users may choose to customize their deployments to prepopulate preferred or frequently used participants.

How will participants be determined? Will there be minimum performance criteria? Will there be minimal financial capital requirements?

The software has no bearing on how Iowa Title Guaranty participants are determined. There is no change and currently no plan to change this process.

How does the system account for variations of terms for each unique transaction?

There is no change from the current system.

How does the net funding that was mentioned during the ITG Board Meeting work? Will Participants be required to use this function? If so, what types of information from the participant will be needed?

Currently, premium payments are processed twice. After closing, the closer or field issuer remits the entire premium to Iowa Title Guaranty. Upon receipt, Iowa Title Guaranty deposits the premium and then returns a portion of the premium to the field issuer as incentive payment.

In the future, we are hoping to streamline incentive payments to our field issuers by virtue of net funding, wherein the field issuer retains the incentive payment and remits the net premium to ITG. This streamlined process would reduce the internal bookkeeping for ITG and result in expedited incentive payments for field issuers. Once ITG can confirm timely payment on each transaction, participants will be required to use this function. The participant would need to provide the information necessary for the electronic funds transfer.

How will payment through this system work and will it be required?

In January 2016, ITG launched the e-payment system. Since that time, the use has been optional, but preferred. Electronic funds transfer will be required with the implementation of our new software.

What discount is available for those that do not use the CLOSING function that essentially allows anyone access to tools that private businesses have committed major investments?

The new premium is for the enhancement of the title production system only. The additional features are optional and offered at no cost. Therefore, no discount will be offered.

How is the privacy maintained for transactions that do not involve Iowa Title Guaranty?

Each participant runs in a completely isolated, virtualized environment. All data storage is isolated by user; each database and persistent file store is unique per user.

Is it the intention of the system to retain abstracts as a repository?

No.

Please provide documentation regarding the statistic quoted at the meeting that 15% of all closings are made with Qualia. I am only to find documentation of a 5% market share.

Annual housing industry reports estimate Qualia’s current market share to be approximately 12-15%.

Would Qualia be willing to provide user references? If so, please provide.

Yes, multiple Iowa users who currently use Qualia will be attending the upcoming ITG Board meeting to provide testimonials. The upcoming Board meeting is at 10:30 a.m. on Tuesday, August 6, 2019, at the Iowa Finance Authority office, 1963 Bell Avenue, Suite 200 in Des Moines.

Please provide documentation as to the parties providing the Series B funding and list of those with financial commitment to the Qualia. Will investors have access to transactions or data? What safeguards are in place for use of analytics and data by investors?

Qualia has been thoroughly vetted by ITG. Listing Qualia’s investors is irrelevant to the enhancement of our title production software. The previously noted privacy standards apply.

Exactly what information will be confidential and limited to those listed as a party to the transaction, and what information will be available for anyone to access, including parties able to see previous work?

There is no change to the information shared with ITG. All information will be private to the individual participant/organization.

Will a demonstration of the product be available prior to the vote?

ITG has conducted extensive product research over the last seven months, which included in-depth demonstrations from Qualia. The ITG staff, by unanimous decision, has selected Qualia to develop ITG’s new title production software. A wide variety of training opportunities will be available during the software customization phase.

Explain the referenced “social media” component of the system, how it can be used, who can view it, etc.

There will be no social media component of the new software system. Social media was referenced during the Board meeting only as analogy to describe the user-friendly, intuitive interface.

How can the legal pass through (populate) to a deed or mortgage if each lender has a unique form for these documents? How does the legal populate and place the legal? This feature was highlighted at the ITG Board meeting.

The legal description will be entered into a merge field at commencement of a file. The legal description will automatically populate any document uploaded that contains a merge field. The tool is only as useful as the document each user chooses to upload into her/her own deployment, but we hope that participants will take advantage of this feature. Subsequent revisions to the legal description field will push through to every document uploaded.

Will the attorneys, lenders, and closers be required to upload form templates or will these be standardized by ITG?

There will be no changes to the ITG templates. If users voluntarily elect to use the other functionalities of the site at no cost, the user may upload additional templates. For example, an attorney will have the ability to upload his/her title opinion template to eliminate rekeying information from the title opinion to the commitment.

How do you adapt to different formats, term variations, and the uniqueness of each closing?

There will be no change to this process.

Does Qualia have a mobile app?

Yes, there is a mobile app for all functions except for title production and escrow. It is not practical to condense these features to a mobile screen. However, even the title production software is “mobile friendly” meaning it will work nicely on a tablet.

How will this technology benefit Iowa abstractors?

The new software will be designed to replace ITG’s current title production software and will provide a communication platform that directly benefits abstractors. For example, abstractors will be notified when a transaction has closed and they can begin preparation of the final abstract. The new software will not require digital abstracting.