New federal rule brings nationwide reporting of real estate purchases by entities, altering compliance expectations across the industry
Title insurers, real estate attorneys, and closing agents are in preparation mode as the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) moves forward with its expanded reporting rule targeting all real estate purchases made by legal entities. Set to take effect on December 1, 2025, the rule requires title companies nationwide to report comprehensive transaction data for residential purchases involving LLCs, trusts, partnerships, and other non-natural buyers—regardless of the purchase price or method of payment.
A Major Departure From Previous Oversight
Until now, FinCEN’s real estate reporting was confined to Geographic Targeting Orders (GTOs), which applied only to cash transactions in selected cities such as Miami, New York, and Los Angeles. The new rule not only lifts the geographic and value thresholds but expands data collection requirements to 111 fields per transaction. These include the identity of the beneficial owner, the structure of the purchasing entity, the full address and type of property, the method and source of funding, and all parties involved in the closing process.
FinCEN’s objective is to create greater transparency in property ownership and prevent bad actors from using shell companies to launder money, hide assets, or evade taxation. The agency cited evidence from the GTO pilot program, which uncovered hundreds of suspicious transactions, as justification for a broader, permanent rule.
Operational Shifts Now Underway
The operational implications for the title industry are significant. Firms must now redesign intake forms, upgrade their customer information systems, and train escrow officers and underwriters on compliance procedures. According to Megan Lawson, a compliance officer at a Phoenix-based title firm, “This isn’t just an update—it’s a full procedural overhaul. We’ve had to bring in outside legal counsel to help us align our data privacy practices with the reporting requirements.”
Some companies are engaging third-party vendors that specialize in KYC (Know Your Customer) and AML (Anti-Money Laundering) solutions to automate beneficial ownership identification. Meanwhile, national title insurers like Old Republic and First American are developing internal portals to streamline secure submissions to FinCEN.
For the average real estate transaction involving an entity buyer, this will mean earlier deadlines for document submissions and additional layers of verification. Real estate agents and brokers are advised to brief clients—especially investors or high-net-worth individuals—on the new requirements to avoid unexpected delays or rejections near closing.
Industry Response and Best Practices
The American Land Title Association (ALTA) has released extensive guidance, including readiness checklists, sample disclosure language, and webinars. ALTA urges firms to adopt a proactive compliance culture and collaborate closely with real estate professionals to maintain transaction flow.
Experts emphasize that while the rule adds complexity, it also reinforces professional standards and promotes integrity across the industry. In the long run, it may even help curb title fraud and improve public confidence in real estate transactions.
The coming months will be critical for firms to finalize system upgrades, staff training, and cross-functional collaboration. With fewer than six months before implementation, the December 1 deadline represents not just a compliance milestone—but a turning point in how the U.S. real estate sector handles transparency and risk management.
